SECTION III............................................................................................................................19
What climate change is bringing to Alaska..............................................................................................................................19
Observed climate change...............................................................................................................................................................20
What the future will bring...............................................................................................................................................................21
Alaska Native communities are particularly affected............................................................................................................22
CASE STUDY: Newtok In The Crosshairs Of Climate Change..............................................................................................22

SECTION IV............................................................................................................................25
Rio+20: The Future We Want..........................................................................................................................................................26
Sustainable development goals...................................................................................................................................................26
Despite calls for more resource extraction, Alaska decision makers now recognize the need for an
alternative, sustainable development pathway......................................................................................................................28

cross the state of Alaska, a post-oil future is coming
into view and taking shape through the work of people,
communities and organizations.
You can see it in the vegetables growing in Arctic greenhouses, in
wind turbines replacing diesel to power community microgrids,
and in the spread of innovative educational initiatives. This future
could improve the lives of every Alaskan, but it needs faith and
support from every level of leadership in the state in order to
be fully realized. Without support from local, state and federal
governments, these innovative efforts might remain only local
and not achieve the growth needed to ensure a just transition
for the people of Alaska.
This report seeks to describe key features of Alaskaâ&#x20AC;&#x2122;s economic
landscape and highlight existing community projects and ideas
that are signposts on the road to a sustainable economy. Many
of these ideas were brought forth during two workshops in July
2016. Participants were predominantly Alaskans from across the
state who hold a great diversity of knowledge and expertise in
the different subject areas. In addition to these existing projects,
the report includes recommendations for policies that could
help amplify and accelerate this transition beyond a continued
economic dependence on fossil fuels and toward a just and
sustainable economy.

6

EXECUTIVE SUMMARY

The Transition is Already Underway

Alaska

is not unique in searching for a just transition to a better economy. Halting global climate
change and building just, sustainable and inclusive economies are the twin inter-locking
challenges of the 21st century. Each region of the world will have to develop solutions that are appropriate
to their local culture and environment. Due to the circumstances of geography, geology and history, Alaska’s
inhabitants are being forced to confront these transitions much sooner than other places. Indeed, the path that
Alaska forges in the next few decades can be a valuable example for other regions and economies.
As the recent plunge in oil prices has illustrated, state finances are overly reliant on oil and gas revenues
and diversifying the Alaskan economy will be crucial for future sustainable economic development. This is
happening against the backdrop of countries ratifying the agreement from the United Nations climate talks in
2015 in Paris and starting to make plans to fulfill their commitments. And even though the Trump Administration
pulled the US out of the agreement, the science hasn’t changed, a fact recognized by states and municipalities
across the country. To avoid the worst effects of climate change, we know that at least two-thirds of proven
fossil fuel reserves must stay in the ground and unproven reserves must remain off limits. To meet the goals
agreed to in Paris, we will have to radically reduce demand for fossil fuels and virtually eliminate global carbon
emissions by mid-century.

Adapting to Rapid Climate Change
Responding to these changes will require public
investments to repair roads damaged by sinking land,
to pay for fire suppression, and to ensure food security
for Alaskans as local ecosystems shift. Additionally,
a number of villages – including Shishmaref, Newtok
and others – have voted to relocate in the face of rapid
coastal erosion, and will require significant financial
and logistical support to make it happen.

Alaska – along with the rest of the circumpolar Arctic
region – is ground zero for climate change, and the
impacts of rising temperatures are visible today across
the state. Scientific assessments have only confirmed
what Alaskan communities (with thousands of years
of accumulated knowledge) can see with their own
eyes.
The National Climate Assessment shows that Alaska
is already experiencing temperature increases well in
excess of global averages. Rapid declines in sea ice
cover raise the possibility that the Arctic Ocean will
be largely free of ice by mid-century, and increasing
coastal erosion is already threatening the very
existence of several Alaskan villages. The changing
climate is fueling larger forest fires and melting
permafrost, and acidification of the oceans will strike
at the very base of the marine food web.

Assessing these various adaptation needs, the report
concludes that the price tag for climate adaptation
in Alaska could top $30 billion under a worst-case
scenario.

2004 tundra fire. (Jim Dau / Northern Alaska Environmental Center)

7

EXECUTIVE
EXECUTIVE SUMMARY
SUMMARY

IMAGE

Community Empowerment and Fighting
Colonialism
As climate justice activist Quinton Sankofa has stated: “Transition is inevitable. Justice is not.” U.S. history is
replete with examples of colonization and oppression of Indigenous communities, together with evidence of
injustice in past economic transitions.
Alaska continues to experience the impacts of the last 150 years of colonization, including the short sighted
exploitation of natural resources and an associated ‘boom and bust’ economic system, undue influence of
the oil industry on the political process, and a resulting heavy reliance on the fossil fuel industry that brings in
economic development at great social costs. For any economic transition in Alaska to be truly just, it must be
democratic and inclusive of all participants and respectful of the cultural traditions and sovereignty of Alaska
Native tribes.
In constructing what a just transition might look like in the Alaskan context, there are local frameworks, like the
Walker/Mallot Transition Team’s sustainability recommendations, as well as global frameworks, such as the
Rio+20 vision of “The Future We Want” and global Sustainable Development Goals (SDGs), that can help guide
decision-making.

Transition Opportunities Abound
While these are by no means comprehensive, we chose to focus on seven thematic areas for just transition
policies in Alaska: investing in human capital, sustainable energy, greater local self-reliance in food and
manufacturing, cleanup of fossil fuel infrastructure sites, protecting ecosystems, Indigenous tourism and
sustainable fisheries. Within each thematic area, there are numerous examples of successful case studies that
can serve as a blueprint for scaling up solutions to benefit all Alaskans.
• Investing in human capital: Alaska’s greatest
natural resources are its people. Key investments in
broadband access as well as in expanding existing
education and job training initiatives could help
remote regions of Alaska grow their work-at-home
economy. Similarly, using, protecting and restoring
the traditional knowledge held by Alaska Native
people and communities (as the Alaska Native

Knowledge Network and other tribal initiatives
are doing) would be of considerable value for
scientific research and climate adaptation. Further
opportunities exist in expanding education, health
and cultural empowerment initiatives, such as
the highly successful Alaska Native Science and
Engineering Program.

8

EXECUTIVE SUMMARY
those in the state’s economically important
national parks, refuges, and forests. Defending
and expanding subsistence rights and economy
could ensure the protection of the cultures and
livelihoods that are so intricately linked. By working
with those communities to protect the intact,
naturally functioning lands and waters they depend
upon and to restore impacted ecosystems, Alaska
can benefit economically.

• Sustainable Energy: Wind, solar and hydrokinetic
installations in communities such as Kotzebue and
Igiugig have already shown that renewable energy
can help reduce high energy costs and open up
new opportunities for development. And indeed
Alaska is already a global leader on the integration
of renewables into “islanded microgrids.”
Expanded investments in energy efficiency and
renewable energy will be critical components of a
just transition.

• Indigenous tourism: Indigenous tourism can be
defined as responsible tourism activity in which
Indigenous people are directly involved through
control, ownership and guidance over economic,
cultural and natural resources, and where tourism
is part of a larger strategy of reinforcing or
revitalizing political and cultural autonomy through
intercultural encounters. However, before tourism
can be a boon to Indigenous communities, there
must be some changes, both to encourage greater
awareness among tourists and to support Alaska
Native communities. Indigenous communities
continue to suffer the effects of colonization
globally, and Alaska is no exception.
They are in a period of healing and
reclaiming human and land rights.
They are succeeding but it is an
important process that the
tourism industry needs to
recognize.

• Greater local self-reliance in food and
manufacturing: Rural Alaskans are already
among the most self-reliant in food production
and the harvest of wild foods plays an important
nutritional and cultural role for many communities.
In addition, a number of local initiatives, such as
the Arctic Greens project of the Kikiktagruk Inupiat
Corporation, are helping to address the high
costs of imported food that remains an issue for
many communities. Again, expanded support and
funding could help these existing initiatives grow
and expand to more communities.

• Cleanup
of
fossil
fuel
infrastructure sites: Decades
of fossil fuel extraction have
left a network of drilling
platforms, pipelines and
other
infrastructure
across the Alaskan
landscape
that
•
Sustainable
will need to be
fisheries:
Alaska’s
safely
removed
fisheries
are
and
adequately
considered some of
restored.
Proper
the most productive,
dismantling,
sustainable,
and
removal
and
healthy in the world.
re s t o r a t i o n
This is no accident;
(“DR&R”) of this
Alaska is the only state
infrastructure could
in the US with a mandate
provide numerous jobs
to sustainably manage
Sea defence wall in Wainwright,
for Alaskans and bring
fisheries
built
into
its
Alaska. (Rose Sjölander / 70°)
economic benefits to the
constitution. Climate change
state. To ensure that this
will bring new opportunities,
process occurs and is carried
but also challenges. While yield,
out satisfactorily, it will be necessary
harvests, and associated jobs and income
to strengthen state standards for cleanup
may rise for some species, changes in migration
and bonding.
patterns, ocean acidification, and invasive species
are likely to threaten the catch of others. Sifting
• Protecting ecosystems: A healthy economy
through these opposing effects and honing in on
depends on a healthy ecosystem, and so too
strategies to ensure that local communities can
do healthy communities and families. Strong
adapt is a complex task that, ideally, will engage
collaboration between Native communities and
marine scientists, local fisher folk, Alaska Native
government agencies is needed to protect the
communities, and fishery managers to succeed.
bountiful lands and waters of Alaska, including

9

EXECUTIVE SUMMARY

Clean up work after the Exxon Valdez oil spill. (Henk
Merjenburgh / Greenpeace)

Policies to Accelerate the Transition

F

ossil fuel extraction is not a stable foundation on which
to build long-term economic growth for the state.
Diversifying Alaska’s economy and investing in a future
beyond fossil fuel extraction will be essential in helping the
state weather future “boom-and-bust” cycles.

Scaling these solutions up will require compatible policies and investments such as
major investments in internet connectivity to bolster the work-at-home economy,
dissemination of traditional knowledge and economic know-how, investments in
efficiency and renewable energy infrastructure, new protected areas on land and
at sea, and more stringent requirements for the cleanup and restoration of fossil
fuel infrastructure.
Some potential policies to achieve these needed investments include cutting fossil
fuel subsidies, fossil fuel risk bonds, a carbon fee and dividend, increased funding
for federal programs, climate adaptation and mitigation funds for tribes, public or
Native banks, and increased eligibility of Alaska Native tribes for federal funding.
The report summarizes these potential policy directions while recognizing that
Alaskans will be the ones to choose the specific path forward. ¢
10

Section I
I: The transition to an economy beyond fossil fuels is
already underway and demands a timely response
from policy makers.
Fossil fuels have played a defining role in the evolution of Alaska’s formal market economy
after statehood was granted in 1958. Prior to statehood, the fishing and mining industries
along with the federal government accounted for most of the jobs and income in Alaska.
Fishing, for example, represented 63 percent of the value of Alaska’s natural resource
production from 1867 to 1958. But after statehood and North Slope oil discoveries, oil
became king. Between 1958 and 2002, oil and gas represented 84 percent ($294 billion)
of the state’s $350 billion production value from natural resources.1
A lot of this wealth has ended up as profits for major
oil and gas producers, but Alaska’s economy has
benefited in other ways. Direct employment in the oil
and gas industry is a small percentage of all wage and
salary employment in Alaska (5-6,000 out of a total
of 335,000 jobs), however, the impact of the industry
on the larger Alaskan economy and, especially, state
revenues is significant.

industry estimates 5,335 jobs in direct employment
and another 45,665 in indirect and induced jobs
supported by their expenditures in Alaska.
In addition, the industry attributes an additional
60,000 jobs to the statewide spending of oil and gas
taxes and royalties.2
In 2014, oil and gas production related taxes provided
nearly 90 percent of the state’s fiscal 2014 general
fund revenues.3

According to a 2014 study commissioned by the
Alaska Oil and Gas Association, the oil and gas

Figure 1: Source: Energy Information Agency

11

SECTION 1
Even under the relatively rosy World Bank forecast, oil
prices will continue to drop in 2016 before they start
a slow but steady increase over decades.10 But even
under the long-term growth forecast, real prices only
rise to $66.30 by 2025, a far cry from the $104.10/
billion barrels of oil (bbl) peak in 2013.11

But in 2014, things began to change. Falling oil prices
and revenues crippled the state’s budget. Revenue
sources have declined by more than 60 percent since
then, even as Alaska’s legislature expanded tax credits
that oil companies used to incentivize exploration. A
forecast for 2017 shows that the state’s general fund
will pay out more in tax credits to the oil industry than
it receives in royalties and production taxes.4

The International Monetary Fund (IMF) uses a separate
forecasting model that foresees an even more modest
rise – to $45.30/bbl in 2020.

To close the resulting budget gaps, the state tapped
its substantial fiscal reserves, drawing down $2.8
billion in fiscal 2015 and an estimated $3.4 billion in
fiscal 2016, even after cutting $1.1 billion of operating
and capital expenditures from the 2016 budget.5

A recent opinion piece summarized the situation
succinctly: “[T]he oil industry is settling in for energy
prices to stay around their current level for a long time.
Alaskans should probably stop hoping for a return to
glory days.”12

By way of comparison, the Alaska Permanent Fund is
currently valued at around $56 billion.6 Unemployment
claims in the oil and gas sector doubled between 2014
and 2015.7 Anchorage alone is expected to lose 1,600
jobs in 2016. Construction spending is forecast to fall
by 18 percent statewide, largely due to declines in the
oil and gas sector.8

What this means for production is underscored by the
latest Alaska North Slope scenarios published by the
Energy Information Administration (EIA) in 2012 (Figure
1). A revolution in oil and gas technology coupled
with declining productivity of existing wells will make
Alaska’s oil and gas reserves less competitive than
they have been historically. As such, under EIA’s high
price scenario, oil production peaks around 2027 and
then begins a steady decline to below today’s levels
in 2035.

This is not some passing trend. There are two
fundamental transitions underway that underscore
the urgency of planning for an economy beyond fossil
fuels – declining profitability and demand for Alaska’s
fossil fuel resources and climate change.

New natural gas proposals such as the massive North
Slope-to-Nikiski project are facing enormous hurdles
due to low price forecasts.13 And while there are
several new coal mining proposals in play, the most
likely scenario for coal is that these new mines will
never be permitted and that Alaska’s single coal mine
– Usibelli mine in Healy – will continue to struggle as
foreign demand wanes.

Declining profitability
and demand for
Alaska’s fossil fuels

Production at that mine has fallen from 2.2 million
tons in 2010 to 1.2 million in 2015. In-state demand
will not compensate for the drop in foreign demand.
The mine currently supplies six small coal-fired plants
in Alaska. Most were built in the 1950s and 1960s,
and most have had problems with environmental
compliance and outdated technology.14

On average, Arctic crude oil has the highest
break-even price of any oil in the world.9
While the economics are complex, sustained
production in the Arctic at prices below $75 per barrel
is unrealistic and tapping new reserves is prohibitive.
Current oil price forecasts don’t bode well.

From the perspective of needing to address climate
change with the urgency it requires, Arctic oil and gas
production should be phased out as soon as possible.
12

SECTION 1

Climate change

Before leaving office, President Obama took steps
to permanently withdraw much of the Chukchi and
Beaufort Seas from future oil and gas exploration. In
this transition, decision makers can help to ensure that
Alaskan communities across the state benefit from
just and sustainable development opportunities along
the way. This report investigates ways to do so that
reflect the latest thinking on sustainable development
while ensuring justice for Alaska Native communities,
the economically vulnerable, and workers in the fossil
fuel industry.

While market forces alone justify more attention to the
transition beyond fossil fuels, climate change makes
the issue urgent and immediate. In the U.S, Alaska
is at ground zero. The anticipated consequences of
climate change in Alaska and the challenges and
opportunities it represents for Alaska’s economy
are discussed below. But for now, the most salient
issue with respect to fossil fuel markets is the nearly
unanimous scientific consensus that to combat the
worst effects of climate change and keep the mean
global temperature increase at or below 2° C, 82
percent of proven global coal reserves, 49 percent of
gas reserves, and 33 percent of known oil reserves
need to stay in the ground.15

What does this just transition look like? ¢

In the Arctic, it all must remain in place.
At the Usibelli mine – Alaska’s only permitted coal
operation – the owners’ estimate proven reserves
at roughly 500 million tons. Leaving 92 percent (the
regional US figure) in the ground would suggest that
just 40 million tons can be burned and still achieve
global climate goals. Average production has fallen
to about 1.5 million tons per year, but has averaged
1.9 million tons between 2009 and 2013. At this rate,
the reserves could potentially be mined for another
21 years and still leave 92 percent of the reserves
in the ground. But this assumes no further drops
in demand. In actuality, demand for Alaskan coal
exports has dwindled to near nothing and is likely
to stay that way indefinitely, and local demand will
vanish once coal-fired plants in use throughout Alaska
are decommissioned or converted to renewable
platforms.
From the perspective of needing to address climate
change with the urgency it requires, Arctic oil and gas
production should be phased out as soon as possible.

Section II
II: A just transition should address Alaska’s socioeconomic challenges.
One of the key principles of a just transition is that future economic development policies,
programs, and projects serve as effective vehicles for improving the social and economic
conditions of those historically disenfranchised or most at risk from a changing economy
and climate.16 To understand what this means in Alaska, it is important to review some
recent data and trends on socio-economic challenges that any new development
pathway should address.

Eradicating Poverty

Without careful economic transition planning, phasing
out fossil fuel production entirely in Alaska will
exacerbate poverty in two key ways: (1) an increase
in the number of unemployed, and (2) a reduction in
social services now funded by the State of Alaska that
are derived from fossil fuel taxes and royalties. Both
issues are discussed in greater detail below.

Poverty is on the rise but can be kept at bay with,
among many efforts, careful economic transition
planning. In Alaska, a person is counted as being
below the poverty line if they make less than $14,720
per year.
For a family of four, that is $30,320, according to the
U.S. Department of Health and Human Services.17
This figure is adjusted each year to compensate for
the high cost of living in Alaska, which is well above
the national average, especially in rural communities.

Maintaining Full
Employment

The poverty rate has climbed steadily from 9.5
percent in 2010 to 11.2 percent in 2014 – the most
recent estimate.

Alaska’s unemployment remains a serious challenge,
one that should be met with an approach toward
diverse job development options that are economically
sustainable and can accommodate subsistence

A cabin along Alaska’s Arctic coast was washed into the ocean because the bluff it was sitting on eroded away.
(Benjamin Jones/USGS)

14

SECTION II

Closing the Inequality
Divide

lifestyles and seasonal travel within the state. Overall
unemployment rate currently stands at 6.8 percent
(November 2016), the worst in the US and well above
the US average of 4.6 percent. The rate for Anchorage
and Fairbanks is lower than the statewide average,
but the unemployment rate is significantly higher than
the statewide average in a number of boroughs where
the fossil fuel industry operates (Table 1).18

Alaska has the most equitable distribution of income
in the nation based on the income inequality index
maintained by Center for American Progress (CAP)
through their Talk Poverty project.22 But a focus on
income inequality masks severe inequalities in many
other dimensions. These include vast differences in
employment, education, energy consumption, food
security, leisure time, health risks and housing.23

At its recent peak, the oil and gas industry estimates
5,335 jobs in direct employment and another 45,665
in indirect and induced jobs supported by their
expenditures in Alaska. In addition, the industry
estimates 60,000 jobs in Alaska are supported by
the spending of oil and gas taxes and royalties.19
The Usibelli coal mine supports 140 direct jobs and

These inequalities are most evident across geographic
(urban/rural) and racial lines.

For example, the unemployment rate in Alaskaâ&#x20AC;&#x2122;s urban
centers is far below the rate in its rural boroughs (Table
1). In the Bethel, Denali, Hoonah-Angoon, Kusilvak,
Lake and Peninsula, Northwest Arctic, and YukonKoyukuk boroughs or census areas of rural Alaska, the
unemployment rate is above 15 percent. The incidence
of poverty and those who lack health insurance is
highest in rural Alaska as well. Additionally, access
to health care and sufficiency of health services are
issues of concern for remote communities.

another 278 indirect and induced jobs associated
with its expenditures.20 It is unclear how many of
the indirect, induced, and tax and royalty-related
jobs would be affected by the transition away from
fossil fuels because these jobs are also fueled by
other sectors â&#x20AC;&#x201C; like recreation and tourism â&#x20AC;&#x201C; that may
expand as Alaska steers economic resources towards
sustainable options for development.

15

SECTION II

Reducing import
dependence and
making life more
affordable

The racial aspect of the income inequality divide is
reflected in numerous ways, such as in the incidence
of poverty. While the statewide poverty rate is 11.2
percent in the latest assessment, it is much higher for
African Americans (31.7 percent), Native Americans
(22.1 percent) and Asian Americans (17 percent).
Another factor driving racial inequality is a lack of
political representatives of color. According to the
National Conference of State Legislatures, White/
Caucasians make up 66 percent of the general
population but 85 percent of legislators. All non-white
ethnicities are under-represented. While American
Indians/Alaska Natives make up 14 percent of the
population, they comprise only 3 percent of the
legislature.

While Alaskans do enjoy a rich and bountiful
landscape, Alaskans also have a high cost of living.28
In a recent analysis, Alaska ranked fourth in states
with the highest cost of living. In terms of four major
categories of expenses, Alaska ranked near the top
for groceries, utilities, and health care in 2016.29
One reason for this is that most consumer goods,
fuel, food – including even fish – and medicines
are imported from afar and costly to distribute. For
example, over 95 percent of the $2 billion worth of
food Alaskans purchase is imported — meaning
over $1.9 billion leaves the state each year.30 Import
dependency has left the economy highly vulnerable
to both price and supply shocks associated with
economic and political turmoil, natural disasters, or
even routine delays. For example, Fairbanks recently
experienced a severe food shortage when one of the
barges the city relies upon for imports was delayed.
The Alaska Division of Geological and Geophysical
Surveys concluded that in the event of a catastrophic
Pacific Northwest earthquake “[v]ital commodities
from the Lower 48 such as gasoline, diesel, aviation
fuel, food, and construction materials would diminish
in variety and quantity and increase in cost.”31

Improving public health
Public health is a major concern in Alaska. Alaska has
the third highest proportion of the population without
health insurance in the country at 14 percent.24 Of
the 25 indicators identified in the Healthy Alaska
2020 Report, 14 are not on track to meet set targets.
These include indicators associated with obesity,
exercise, suicide, depression, caregiving, alcoholism,
fluoridated water, hospitalizations, poverty and
educational attainment.25 Cancer is the leading cause
of death in Alaska (25 percent of all deaths).26 Among
all health indicators, including stroke, chronic lower
respiratory disease, cancer, and heart disease,
Alaska Natives rank lower than the Alaska average.27
Alaskans also don’t use preventative services such as
mammograms, cholesterol testing, and colonoscopy
as often as other Americans.

Point Hope, Alaska. (Rose Sjölander / 70°)

16

SECTION II

Enhancing food
security

found that nearly half of all the homes in the state
are 30 years old or older and in need of a retrofit.37
High housing costs are partly to blame for the lack
of upkeep. The assessment found that more than
75,000 households are cost-burdened, meaning a
family spends more than 30 percent of its income on
rent, mortgage, heat and electricity. Overcrowding is
more than twice the national average, as is energy
consumption compared with similar cold climate
regions of the Lower 48. In addition, the assessment
found that 58 percent of homes lack adequate
ventilation, exposing inhabitants to a number of
health-risks associated with indoor air pollution.

According to the Food Bank of Alaska, nearly 105,000
Alaskans struggle with hunger and 20 percent of Alaskan
kids live in homes that may not have enough food.32
Food insecurity is correlated with a wide array of
physical impairments and harmful psychological
conditions such as chronic depression and substance
abuse. The risks to youth also include “decreased
cognitive performance and academic achievement
as well as increased behavioral and psychosocial
problems.”33

Improving educational
attainment and
vocational skills

While import dependency and vulnerability to price
and supply shocks certainly plays a role in food
insecurity, so too do Alaska’s high costs of agricultural
production, climate change (which is causing
unpredictability and wreaking havoc on the harvest of
traditional foods), and changes in dietary preferences
away from wild foods and toward processed foods
from afar.34 For Alaska Natives, food security rests
on a foundation of six interconnected dimensions
including availability, culture, decision-making power
and management, health and wellness, stability and
access. Climate change, a history of colonization,
and a resource extraction-oriented economy threaten
food security by undermining one or more of these
key dimensions.35

There is an opportunity to make significant gains in
education and vocational skills development across
the state. Alaska lags behind the contiguous United
States in a number of metrics related to educational
attainment. A 2008 report commissioned by the
Alaska Commission on Postsecondary Education put
it bluntly: “Alaska consistently ranks at the bottom in
educational performance indicators.”38 Educational
performance indicators are not consistently reported
annually, sometimes only once in ten years or so
matching census data collection patterns, but most
data from the past decade reaffirm this assertion.

Modernizing the
housing stock

The relative lack of formal educational attainment is
mirrored by a lack in employable skills. In terms of skills,
Alaska students perform poorly in reading and math
according to the National Assessment of Educational
Progress (NAEP). In fact, half of all University of

SECTION II
Alaska freshmen take remedial English and/or math.
A recent Anchorage Chamber of Commerce survey
illustrated that regional employers believe that the
majority of their entry-level applicants don’t have
basic employability skills, even after graduating from
college.39

Alaska’s schools – from elementary to university level
- face budget cuts for both teachers and support
services they rely upon.”40 One existing proposal
would cut back on subsidies for high-speed Internet
in rural areas, something that would affect 90 percent
of University of Alaska’s students who take at least
one course remotely.

Securing adequate
funds for health,
education, and welfare

Education is not the only program at risk. The Alaska
Department of Health and Human Services FY
2016 budget was reduced by $80.3 million dollars
over FY 2015 and Medicaid made up the largest
share (65 percent) of the cuts.41 The Department
of Environmental Conservation’s food safety and
sanitation program took $624,000 in cuts last year and
another $268,000 is being proposed for FY 2017.42 ¢

One of the most alarming side effects of Alaska’s fiscal
crisis is its impact on social safety net spending and
spending on other programs that yield broad-based
benefits to all Alaskans. As revenues have crashed,

—CASE STUDY—
Oscarville’s Holistic Approach
to Community Sustainability
In 2014, Oscarville, a small community in the Yukon Kuskokwim Delta region,
volunteered to be the subject of a pilot project that will use a holistic approach
involving community engagement and interagency (local, state, federal) partnerships
to address many different issues such as culture, housing and infrastructure,
energy, economic development, community health, and water and sanitation. The
aim of the pilot is to begin creating a statewide model for community development.
Some of the immediate needs to be addressed in the project include a well for the
school, securing funding for energy efficiency upgrades, weatherization, and new
housing, and implementing a board road extension to neighboring Bethel. The initial
grant for the project was awarded through the Cold Climate Housing Research
Center from the Association for Village Council Presidents and Wells Fargo.43

18

Section III
III: A just transition should also help Alaskans
adapt to the catastrophic consequences of climate
change.
Economic and social challenges of the just transition are many. But all these may be
dwarfed by the challenges presented by rapid climate change. The ground-breaking
Arctic Climate Impact Assessment in 2004 identified impacts on natural systems and
society, indigenous communities, and economic consequences in Alaska.44
Climate change in Alaska is not just a matter of eroding coastlines, vanishing sea ice,
and unprecedented wildfires. Impacts on Alaskaâ&#x20AC;&#x2122;s communities, economy and public
finances are already dramatic as climate disasters continue to unfold and as the state
incurs billions of dollars of costs to adapt. Alaska Native communities are the hardest
hit. This section presents an overview of what climate change is already bringing as well
as predictions for the future.

What climate change is bringing to Alaska
It has often been said that Alaska is â&#x20AC;&#x153;ground zeroâ&#x20AC;?
for climate change, and for good reason. The most
recent National Climate Assessment (2014) from the
US Global Change Research Program presents an
alarming overview of climate change effects already

unfolding and even more dire predictions of what is
to come if global climate agreements fail to meet their
targets.45 Unless otherwise noted, the following are
excerpts from that report.

Observed climate change
• Over the past 60 years, Alaska has warmed more than twice as rapidly as the rest of the United States, with
state-wide average annual air temperature increasing by 3°F and average winter temperature by 6°F, with
substantial year-to-year and regional variability.
• Arctic sea ice extent and thickness have declined substantially, especially in late summer (September),
when there is now only about half as much sea ice as at the beginning of the satellite record in 1979.
Reductions in sea ice alter food availability for many species from polar bear to walrus, make hunting less
safe for Alaska Native hunters, and create more accessibility for Arctic Ocean marine transport, requiring
more Coast Guard coverage.
• With the late-summer ice edge located farther north than it used
to be, storms produce larger waves and more coastal erosion.
An additional contributing factor is that coastal bluffs that
were “cemented” by ice-rich permafrost are beginning
to thaw in response to warmer air and ocean waters,
and are therefore more vulnerable to erosion.
• Several coastal communities are seeking to
relocate to escape erosion that threatens infrastructure and services but, because of high
costs and policy constraints on use of federal
funds for community relocation, only one
Alaskan village has begun to relocate.
• Permafrost near the Alaskan Arctic coast
has warmed 4°F to 5°F at 65 foot depth
since the late 1970s and 6°F to 8°F at 3.3
foot depth since the mid-1980s. In Alaska,
80% of land is underlain by permafrost, and
of this, more than 70 percent is vulnerable
to subsidence upon thawing because of ice
content that is either variable, moderate, or
high. Thaw is already occurring in interior and
southern Alaska and in northern Canada, where
permafrost temperatures are near the thaw point.

Coastal erosion at Drew Point, NPR-A. (U.S. Fish &
Wildlife Service)

• Both wetland drying and the increased frequency
of warm dry summers and associated thunderstorms
have led to more large fires in the last ten years than in any
decade since record-keeping began in the 1940s. In Alaskan
tundra, which was too cold and wet to support extensive fires
for approximately the last 5,000 years, a single large fire in 2007
released as much carbon to the atmosphere as had been absorbed
by the entire circumpolar Arctic tundra during the previous quarter-century.
Thick smoke produced in years of extensive wildfire represents a human health risk.
• Ocean acidification, rising ocean temperatures, declining sea ice, and other environmental changes interact
to affect the location and abundance of marine fish, including those that are commercially important, those
used as food by other species, and those used for subsistence. At some times of year, acidification has
already reached a critical threshold for organisms living on Alaska’s continental shelves. Certain algae and
animals that form shells (such as clams, oysters, and crab) use carbonate minerals (aragonite and calcite)
that dissolve below that threshold.

20

SECTION III

Fishing Boat in Unalaska. (Mark Meyer / Greenpeace)

What the future will bring
• Average annual temperatures in Alaska are projected to rise by an additional 2°F to 4°F by 2050. If global
emissions continue to increase during this century, temperatures can be expected to rise 10°F to 12°F in the
north, 8°F to 10°F in the interior, and 6°F to 8°F in the rest of the state.
• Models project that permafrost in Alaska will continue to thaw, and some models project that near-surface
permafrost will be lost entirely from large parts of Alaska by the end of the century. In rural Alaska, permafrost
thaw will likely disrupt community water supplies and sewage systems, with negative effects on human
health.
• Annual minimum sea ice extent is decreasing at a rate of 12% per year. Forecasts of an ice-free Arctic
Ocean range from 20-30 years from now to much sooner.46
• Uneven sinking of the ground in response to permafrost thaw is estimated to add between $3.6 and $6.1
billion (10 percent to 20 percent) to current costs of maintaining public infrastructure such as buildings,
pipelines, roads, and airports over the next 20 years.
• Even if climate warming were curtailed by reducing [greenhouse gas] emissions, the annual area burned in
Alaska is projected to double by mid-century and to triple by the end of the century.
• The polar ocean is particularly prone to acidification because of low temperature and low salt content, the
latter resulting from the large freshwater input from melting sea ice and large rivers. Acidity reduces the
capacity of key plankton species and shelled animals to form and maintain shells and other hard parts, and
therefore alters the food available to important fish species.
• Shelled pteropods, which are tiny planktonic snails near the base of the food chain, respond quickly to
acidifying conditions and are an especially critical link in high-latitude food webs, as commercially important
species such as pink salmon depend heavily on them for food. A 10% decrease in the population of
pteropods could mean a 20% decrease in an adult pink salmon’s body weight.

21

SECTION III

Alaska Native communities are particularly
affected
Alaska Native communities will feel the worst effects
of climate change for three primary reasons. First,
in rural areas, Native villages and communities are
almost exclusively located along coastlines and rivers
that will be subject to increased coastal and inland
flooding and erosion. Most of Alaska’s 200 or so
villages have already been affected to some degree
and 31 are in need of relocation or are in the process
of being moved.47

Some of the climate change impacts of most concern
for Alaska Native communities include:48
• Decreases in the amount of wild foods available due
to adverse changes in ice patterns, vegetation, fish
and game populations, fish and game migration
patterns, water resources and access.
• Increasingly risky and costly travel across newly
inundated lands, ice-free areas, and roads and
bridges at risk from permafrost melting.

Secondly, Alaska Natives, especially those living in
rural areas, depend economically, nutritionally, and
culturally on hunting and fishing for their livelihoods
and so changes in the abundance and distribution of
subsistence species affect Alaska Native populations
more than other Alaskans who tend to rely more on
foods bought and sold in the market.

• Sanitation and health problems also result from
deteriorating water and sewage systems, and
ice cellars traditionally used for storing food are
thawing. Warming also releases human-caused
pollutants, such as poleward-transported mercury
and organic pesticides, from thawing permafrost
and brings new diseases to Arctic plants and
animals, including subsistence food species,
posing new health challenges, especially to rural
communities.

Lastly, Alaska Native communities have seen
inadequate resources for adaptation, which means
more exposure to the effects of climate change.

—CASE STUDY—
Newtok In The Crosshairs Of
Climate Change
Newtok, a Yup’ik Eskimo community on the seacoast of western Alaska, is on the front lines
of climate change. Between October 2004 and May 2006, three storms accelerated the erosion
and repeatedly flooded the village water supply, caused raw sewage to be spread throughout
the community, displaced residents from homes, destroyed subsistence food storage, and shut
down essential utilities. The village landfill, barge ramp, sewage treatment facility, and fuel storage
facilities were destroyed or severely damaged. The loss of the barge landing, which delivered most
supplies and heating fuel, created a fuel crisis. Saltwater is intruding into the community water
supply. Erosion is projected to reach the school, the largest building in the community, by 2017.
Newtok’s situation is not unique. At least two other Alaskan communities, Shishmaref and Kivalina,
also face immediate threat from coastal erosion and are seeking to relocate, but have been
unsuccessful in doing so.

22

SECTION III
• It may be difficult to sustain traditional subsistence
life ways when Alaska Native communities and
settlements on ancestral land are collapsing due
to permafrost thawing, flooding, and erosion
combined with loss of shore-fast ice, sea level
rise, and severe storms, especially along the
coasts and rivers.

to public infrastructure from 2015 to 2099 total $5.5
billion under the highest climate-forcing scenario
(RCP8.5).51 The study also found that mitigation and
pro-active adaptation measures could significantly
reduce those expenses.
A significantly greater expense will be the costs
associated with relocating villages and Alaska
residents out of harm’s way. According to the U.S.
Army Corps of Engineers, the estimated cost of
relocation for Kivalina’s 400 residents runs between
$95 and $125 million.52 This means that government
estimates to relocate run between $240,000 and
$310,000 per resident. Newtok, Alaska, is in the
process of relocating because of erosion, at a cost
that could run as high as $130 million, according to an
estimate by the Army Corps of Engineers.53 With 354
villagers in Newtok, that amounts to roughly $370,000
per person. There are 30 to 60 villages that may need
to be physically relocated as ocean ice, sea levels,
and seasons become unpredictable in Alaska. At a
cost of at least $100 million per village, the price tag
could top $6 billion.

• It is uncertain how Alaska Native communities will
be able to effectively relocate with an outcome
most preferable to them, particularly because
there are no institutional frameworks, legal
authorities, or funding to implement relocation for
communities forced to relocate.

Adaptation costs could
top $30 billion

All of these impacts across the state will strain
the financial resources of federal, state, and local
government agencies. Thawing permafrost will place
the state’s network of roads, rail, airports, and energy
Resettlement may also be needed for those living
and water supply at risk since most of this infrastructure
in areas susceptible to melting permafrost. An
is built on a permafrost foundation.49 Warmer
estimated 100,000 Alaskans (about 14 percent
temperatures and warmer oceans may
of the population) live in areas sensitive
also lead to more intense coastal
to permafrost degradation.54 There
storms and increased damage
has yet to be a comprehensive
to residential, commercial,
assessment associated with
and public buildings and
the costs this population
infrastructure. Sea level
will face such as housing
rise will inundate a
repair and replacement,
significant portion of
although
estimates
coastal infrastructure.
indicate these costs
A
recent
study
could greatly exceed
by Larsen et al.
the
estimated
(2008)
attempted
damages to public
to
quantify
the
infrastructure.
potential impacts
Assuming
all
of climate change
100,000
people
on Alaska’s public
would need to be
infrastructure
at
resettled, and using
Abandoned home near the coast of
risk. The authors
the range of costs
Shishmaref, Alaska. (Lawrence Hislop / GRID
concluded that climate
of resettlement per
Arendal)
change
could
add
person, the resettlement
$3.6–$6.1 billion (+10% to
cost alone due to melting
+20% above normal wear
permafrost could range
and tear) to future costs for
from $24 to $37 billion in the
public infrastructure from now
worst-case scenario.55
to 2030 and $5.6–$7.6 billion (+10%
Another major adaptation expense will
to +12%) from now to 2080.50 A recent
be the increased cost of suppressing and containing
study by Melvin et al. (2016) reached similar findings
wildfires.
– cumulative expenses from climate-related damage

23

SECTION III
Across the United States, climate change has
led to fire seasons that are now 78 days longer on
average compared to 1970.56 U.S. wildfires have also
grown dramatically in terms of acreage burned and
in financial costs to communities, businesses, and
residents. In Alaska, fire frequency has doubled over
the past 25 years.57 The annual acreage burned is
likely to be two to three times greater by century’s end.
In 2015, the second costliest year, 5.1 million acres
burned in Alaska at an expense of over $100 million
– or roughly $20 per acre. The acreage burned was
over 5 times the long-term average of approximately
1 million acres. If we assume that, on average, the
annual acres burned doubles between now and 2080,
then this implies the need for an additional $2.5 billion
for fire suppression.

at the Department of the Interior. Approximately $400
million of a $2 billion Coastal Climate Resilience
program would be set aside “to cover the unique
circumstances confronting vulnerable Alaskan
communities, including relocation expenses for Alaska
Native villages threatened by rising seas, coastal
erosion, and storm surges.”58 Repealing offshore
oil and gas revenue sharing payments authorized
to a few states under current law would pay for this
program, however Congress did not approve the
President’s proposal. But this still leaves a gaping
hole in adaptation needs. Governor Walker has his
own plan: increase oil drilling to boost state revenues.
This approach, unfortunately, doesn’t get Alaska out
of the cycle of dependence on the fossil fuel economy
and further exacerbation of climate change.59

Thus, taken together, climate adaptation costs
associated with public infrastructure, relocation
of villages and communities located on melting
permafrost, and fighting wildfires could easily run
to the tens of billions of dollars. And this excludes
many other categories of adaptation expense such as
increased public health care costs. At present, there
are no concrete mechanisms in place to pay for these
climate adaptation expenses in Alaska.

While these are major challenges, they provide
Alaska the opportunity for innovative solutions aimed
at economic sustainability. For example, later in this
report we make the case that the costs associated
with climate adaptation should be paid for by the fossil
fuel industry through implementation of a state Fossil
Fuel Risk Bond program capitalized by a surcharge
on all fossil fuel transactions. This program, along
with many of the other solutions and ideas – some of
which are already being embraced in places across
the state - will enable greater resilience and economic
stability for Alaskan communities into the future. ¢

Clearly, the federal government will play a role. In
his FY 2017 budget proposal to Congress, President
Obama included a Coastal Climate Resilience Fund

Section IV
IV: The sustainable development framework embraced
by the US, the international community, and political
leaders in Alaska can guide a prosperous path forward.
For decades, the international community has coalesced around a vision for sustainable
development for all nations that remedies inequities of the past, provides all people with
access to the resources they need to thrive, and reverses the degradation of ecosystems
and the global climate. The most recent iteration of this vision is embodied in â&#x20AC;&#x153;The Future
We Want,â&#x20AC;? the outcome document from the 2012 Rio+20 United Nations Conference
on Sustainable Development.60 The Rio+20 process also set in motion a process to
articulate a set of Sustainable Development Goals (SDGs) to implement the Rio+20 vision
and replace the Millennium Development Goals, which expired in 2015. In September of
2015, the UN General Assembly adopted a resolution that enumerated 17 SDGs as well
as targets and indicators to track progress. The United States government has firmly
embraced the outcomes of both the Rio+20 and SDG processes, and because of this,
they provide a rich framework for Alaskans to take charge of future development of the
state in the era beyond fossil fuels.

Respecting traditional knowledge is critical. In
particular, the outcome document recognized that
“the traditional knowledge, innovations and practices
of Indigenous peoples and local communities make
an important contribution to the conservation and
sustainable use of biodiversity, and their wider
application can support social well-being and
sustainable livelihoods.”62

The outcome document itself was negotiated over
a 3-year period and is organized into six broad
sections that (I) articulate a common vision; (II) renew
commitments to previous frameworks; (III) define a
green economy in the context of poverty eradication;
(IV) identify institutions needed to advance sustainable
development; (V) provide a framework for follow up
actions, and (VI) discuss means of implementation.
A list of thematic elements included in section V are
among the most important results of the Rio+20
process because they identify where interventions
are likely to be most beneficial. The thematic elements
most relevant for Alaska include:
•
•
•
•
•
•
•
•
•
•
•
•
•
•
•

Sustainable development goals
The seventeen SDGs adopted by the UN closely track
the thematic areas addressed by the Rio+20 outcome
document.63 Goals were developed for poverty,
hunger, health, education, gender equity, clean water
and sanitation, energy, employment, infrastructure,
inequality, cities, production and consumption,
climate change, oceans, terrestrial ecosystems,
peace and justice and global partnerships. But unlike
the Rio +20 outcome document, the SDGs provide
a quantitative basis for monitoring progress. Most
SDGs contain several quantitative targets and a date
for achieving them.

Poverty eradication
Food security, nutrition, and sustainable agriculture
Clean and stable water supplies
Access to sustainable modern energy services
Sustainable tourism
Universal access to quality health care
Promoting full and productive employment,
decent work for all and social protection
Conservation and sustainable use of the oceans
Reversing deforestation and forest degradation
Disaster risk reduction
Adaptation to climate change
Conservation of biological diversity
Sustainable consumption and production
Universal access to quality education
Gender equality and women’s empowerment

Table 2 displays the text of 15 of the 17 sustainable
development goals. Goals 16 and 17 relate to national
or international level governance issues and so are
not included. Beneath each of these goals is a set of
quantitative targets for achieving progress by a certain
date. For example, for SDG 8 target 8.4 includes the
following aspiration:
“Improve progressively, through 2030, global resource
efficiency in consumption and production and endeavour
to decouple economic growth from environmental
degradation, in accordance with the 10 Year Framework
of Programmes on Sustainable Consumption and
Production, with developed countries taking the lead.65”

This lengthy list of thematic areas is most useful
for evaluating the success or failure of economic
development policies, programs, and projects. In
particular, a successful policy would simultaneously
advance goals and targets developed for as many of
these thematic elements as possible. The outcome
document also acknowledges the imperative of
preserving and restoring indigenous cultures,
lifestyles, and economy. For example, an important
condition placed on policies to promote the green
economy is that they should:

What is of significance in Table 2 is the confirmation
that SDGs are universally applicable – applicable not
only to developing countries but also to developed
countries undergoing the process of decarbonizing
their economies. Many of the goals and targets are
directly relevant to the social, economic and climate
challenges facing Alaska discussed in Section
II and, as such, are extremely useful as a way to
screen and prioritize sustainable development policy
interventions.

“Enhance the welfare of indigenous peoples and their
communities other local and traditional communities
and ethnic minorities, recognizing and supporting their
identity, culture and interests, and avoid endangering their
cultural heritage, practices and traditional knowledge,
preserving and respecting non-market approaches that
contribute to the eradication of poverty.61”

One way to envision such a screening and prioritization
process is through use of a “spider chart” that helps
evaluate the simultaneous contribution of strategies to
move beyond fossil fuels in relationship to achieving
several sustainable development goals (Figure 3).

26

SECTION IV

Figure 4: Stylized “spider chart” useful for scoring the contribution of beyond fossil fuels strategies to
sustainable development goals. Each strategy (fossil fuel infrastructure DR&R and knowledge sharing
platforms for food security) is ranked on a scale of 0-40 for each of nine sustainable development goals.

workers in the fossil fuel industry and restoring
ecosystems (score of
40 for each of these
goals) but contributes
less to other goals.
Likewise,
knowledge
sharing platforms for
local
food
solutions
directly contributes to
food security and building
knowledge and skills
(score of 40 for each of
these goals) and makes
important, but lesser
contributions to other
goals. Solutions with the
largest area on the chart
are ones that represent
those with the biggest
sustainable development
contribution across all
goal areas.

Data for Figure 4 are hypothetical but would be based
on subjective evaluation
criteria. Here, two beyond
fossil
fuel
strategies
discussed later on in
this report – dismantling,
rehabilitation,
and
restoring (DR&R) sites
now occupied by fossil
fuel infrastructure and
knowledge platforms for
local food solutions – are
each presented in terms
of a subjective score
on a scale of 0-40 for
each of nine sustainable
development goals. So,
for example, fossil fuel
infrastructure
DR&R
could be an important
strategy for retaining full
employment of existing

The most obvious
danger, is “that of
exploitation under the thin
disguise of development.”
­ E.L. Bartlett,
—
Alaska’s First Senator

Table 2: Sustainable Development Goals adopted by the US and 191 Other Nations64
(Goals 16 and 17 not displayed)

Despite calls for more resource extraction, Alaska
decision makers now recognize the need for an
alternative, sustainable development pathway.
the importance of sustainability. Few, however,
have treated sustainability – both economic and
environmental – as much more than an afterthought.
Instead, they have called for expansion of resourceexploitation activities that focus on converting one
resource into cash with insufficient attention to the
negative spillover impacts. However, there have been
positive examples of constituencies successfully
holding these projects accountable and protecting
local economies and bioregions, such as the case
of Pebble Mine. This is a project-specific illustration
of resource extraction accompanied by inadequate
consideration of negative spillover impacts on
sustainability. In 2015, the EPA concluded that the
mine would jeopardize almost half of the world’s wild

Many Alaskans have long recognized the importance
of developing an economy that will provide sustainable
economic benefits to all of the state’s citizens. Notable
within the state’s history are Alaska’s first senator,
E.L. Bartlett’s (1955) warnings to the constitutional
convention about “the vital issue of resources policy.”
The most obvious danger, he warned, is “that of
exploitation under the thin disguise of development.”
To guard against this danger, he encouraged Alaskans,
“in their eagerness to get resources development,”
to “not lose sight of the absolute necessity for longrange policy in the resources field.”
Economic development efforts since then typically
have acknowledged these warnings and stressed

28

SECTION IV
sockeye as well as a fishing industry that generates
almost $0.5 billion in annual economic activity, and
provides employment for more than 14,000 workers.66
In addition, reductions in salmon populations would
negatively affect the supply of nutrients that spawning
salmon supply annually to the ecosystem of the
Bristol Bay watershed. Mining operations also would
lead to the loss of 1,100 or more acres of wetlands
and five or more miles of streams, and alter more than
20 percent of the streamflow in nine or more miles of
streams (U.S. EPA 2015).

at a regional or statewide scale. Alaska Forward, for
example, the “first statewide economic development
strategy” has focused on stimulating the expansion
of mining, oil/gas production, logging, and fishing
without describing the negative spillover impacts
on resource sustainability or making a meaningful
commitment to minimize them.67 Similarly, the Alaska
Arctic Policy Commission (2015) has proposed
initiating mineral mining, coal mining, and building
new roads and port facilities to interact with outside
markets, but its proposal offers no description of the
negative impacts that inevitably would accompany
these developments.68 It contains no meaningful plan
to control unsustainable impacts on water, wildlife,
fish, and other resources.

Other economic-development efforts similarly have
failed to consider the negative spillover impacts of
industrial resource extraction on sustainability, but

Transition Team
Committee
Subsistence

Illustrative Recommendations
•
•
•
•
•
•

Manage all lands to sustain abundance
Meaningfully empower Tribes and other subsistence users
Sustainability of the resource comes first
Recognize subsistence use as customary and traditional use and as the priority use
of wild renewable resources
Include traditional knowledge in subsistence management
Subsistence use and opportunity is sufficient to fulfill economic, cultural, social, and
spiritual needs

Arctic Policy and
Climate Change

•

Consumer Energy

•
•
•
•
•

Economic
Development

• Economic development should create sustainable Alaskan jobs and create
individual wealth for Alaskans.
• Provide high-speed and affordable communication in every Alaska Community
• Reduce energy costs by 50% within 3 years through a combination of
improving building stock and producing local affordable energy
• Energy efficient affordable, available housing across rural Alaska
• Build and/or upgrade commercial grade infrastructure including roads, ports
and bridges with goal of improving land, air and sea transportation and access
throughout Alaska

Infrastructure

• Fund only projects with a demonstrated long-term operational sustainability
and financial feasibility

•

Community sustainability can be furthered by prioritizing lower cost energy, healthy
environments, language and cultural preservation.
The State can work with communities to develop economic opportunities that
improve infrastructure, increase culturally and technologically relevant educational
opportunities, safeguard resources, and enhance and maintain unique and important
Alaska Native cultures.
Focus on reducing energy use as low hanging fruit
Within 4 years to reduce the cost of energy for all Alaskans.
Bring affordable energy to the Interior
Ensure local workforce participates in energy projects
Incentivize diversity in manufacturing

Table 3: A sample of pro-sustainability recommendations from the Walker/Mallot Transition Team23

29

SECTION IV
Despite these new initiatives to continue down the
road of resource extraction, Governor Bill Walker
and Lieutenant Governor Byron Mallot recognize
elements of the sustainable development agenda
must be priorities. The Walker/Mallott Transition
Team, comprised of nine committees focused on
distinct issues facing the administration, called for
an increased emphasis on sustainability from several
different perspectives (Table 3). The Arctic Policy
and Climate Change committee set the overall tone
in this regard by highlighting this high-priority issue:
Ensuring the sustainability of rural Alaska, particularly
Alaska Native communities.

communities with the tools necessary to ensure their
long-term viability. Community sustainability can be
furthered by prioritizing lower cost energy, healthy
environments, language and cultural preservation, and
improved relationships between the State of Alaska,
Alaska Natives, and other rural Alaskan communities.
The State can work with communities to develop
economic opportunities that improve infrastructure,
increase culturally and technologically relevant
educational opportunities, safeguard resources, and
enhance and maintain unique and important Alaska
Native cultures. These improvements would also
reflect a value shift from a focus on short term success
rooted in capitalism and exploitation to one focused
on environmental and economic sustainability as the
foundation for a thriving Alaska. Â˘

The Arctic Policy and Climate Change committee
agreed that significantly more emphasis must be
placed on, and resources dedicated to, sustainability,
adaptation, and resilience in order to equip

The village of Noatak, 70 miles north of the Arctic Circle. (Josh Foreman / U.S. National Park Service)

30

Section V
V: Sustainable development opportunities abound
in Alaska but will require changes in policy and
public investments to bring them to scale.
Sustainable development solutions abound in the State of Alaska. The most successful
of these solutions harnesses community involvement and support at the local level and
seeks to solve a problem or challenge that has been identified by the community with
sensitivity to and an understanding of local environments and livelihoods. But in order
to scale these solutions up, changes in public policy, spending and incentives will need
to be made. In this section we discuss six thematic areas that could provide a policy
focus as well as promising strategies and case studies that could serve as blueprints for
advancing sustainable development goals for all Alaskans.

Thematic Area 1: Human Capital
From a socio-economic standpoint, human capital
consists of the knowledge and skills present in a given
population as well as states of mental and physical
health that facilitate its use in the pursuit of individual
and social wellbeing. In the modern economy,
computer skills, for example, are an important
manifestation of human capital:

market and traditional spheres are critical to Alaska’s
future. A 2010 economic outlook prepared for the
northern territory of Nunavut, Canada underscored
this point:
“Human capital is the overall capacity in terms of
health, knowledge, education, and skills of people
to be productive whether they are participating
in the wage economy, active in the land-based
economy, volunteering or supporting the family, or
pursuing education (traditional or western) or training
opportunities.71”

“Your ability to work with computers is one of your
individual productive capabilities. These capabilities
depend not only on your knowledge, education,
training, and skills; they also include useful behavioral
habits as well as your level of energy and your physical
and mental health.70”

Among strategies for eradication of poverty and
reducing inequality, investment in human capital is
essential. As noted by Thomas Piketty, “[k]nowledge
and skill diffusion is the key to overall productivity
growth as well as the reduction of inequality
both within and between countries.”72 Acquiring
human capital through either formal or traditional
educational systems can be “the most effective way
for able young people of poor backgrounds to rise
in the economic hierarchy, because human capital
is the main asset of 90 percent of the population.”73

In indigenous and subsistence societies, important
forms of human capital include traditional knowledge
(TK), sometimes also referred to as Indigenous
knowledge, traditional ecological knowledge, or
local traditional knowledge, although they all carry
variations in meaning. These terms refer to knowledge
acquired over thousands of years and associated with
preparation and consumption of foods, medicines,
clothing, and building materials hunted, fished or
gathered in the wild. Human capital in both the formal

31

SECTION V
themselves because of age, disability, or other
circumstances.

Strategies to build human capital in Alaska can take
several forms, including:

• Customary trade: Specialized products like seal
oil are bartered and exchanged in traditional trade
networks between communities. Furs sold to
outside markets provide an important source of
income to many rural areas.

Using, protecting and
restoring traditional
knowledge

• Ceremony: Traditional products are used in
funerals, potlatches, marriages, dances, and other
ceremonial occasions.

Traditional knowledge (TK) is a form of human capital
– a set of knowledge and skills that makes harmonious
and sustainable use of fish, game, medicinal and
edible plants, and materials for dwellings, tools,
boats, and other community infrastructure possible.
It not only provides the foundation for livelihoods but
also the inspiration for governance and cultural and
spiritual rituals and practices that honor nature as a
provider.

• Arts and crafts: Ivory, grass, wood, skins, and furs
are crafted into beautiful items for use and sale
throughout Alaska and beyond.
Despite its importance and a growing appreciation
for TK in the Arctic among outsiders, there are many
factors that challenge its continued use, protection,
and restoration. Disappearing native languages is
one important factor since TK is often languagespecific – and in Alaska, there are 20 such languages
at risk.76 There are policy and cultural pressures at
work, such as ostracization of native languages in the
public school system, television, and youth being less
interested in maintaining traditional ways or having
opportunities to utilize it: “[p]arts of the traditional
knowledge have faded since it is no longer needed
among the younger generation and even if a younger
member of the society shows interest in maintaining
the traditional knowledge they might still lack the
necessary practical ingredient.”77 Other challenges
involve the difficulty and resistance to integrating TK
into “modern educational, scientific, administrative,
juridical, political, and resource-management regimes
and structures.”78 There have been exceptions to this
as a result of innovation and unique partnerships.

Alaska Native communities rely on TK to maintain
subsistence-based lifestyles and maintain cultural
integrity. The importance of TK in Alaska is illustrated
by the wide range of goods and services ecosystems
provide to Alaska Native communities as well as the
cultural practices such goods and services support.
TK provides the means to locate, extract, process,
store and use these ecosystem goods and services
for:74
• Food: Traditional foods contribute a significant
amount of nutrients to the diet of all Alaska Native
communities.75
• Clothing: Wild furs and hides are still the best
materials for ruffs (wind guards), mitts, parkas,
kuspuks, clothes lining, and mukluks (winter
boots) in many regions.

But a new and significant threat comes from climate
change. Climate change stands to adversely impact
species and ecosystems that produce traditional foods
vital to Alaska Native culture, economy and traditional
ways of life by changing their patterns of abundance,
distribution and migration.80 As the once permanently
frozen landscape thaws, markings that hunters used
to navigate their way have been lost or changed. For
example, in the Canadian Arctic, Inuit elders who
traditionally used their skills to predict the weather
have observed changing cloud and wind patterns.
Their weather and climate-related knowledge does
not fit with today’s weather conditions and patterns.81

• Fuel: Wood is a major source of energy in rural
homes, and is used for smoking and preserving
fish and meat.
• Transportation: Fish, seal, and other products are
used to feed dog teams.
• Construction: Spruce, birch, hemlock, willow, and
cottonwood are used for house logs, sleds, fish
racks, and innumerable other items.
• Home goods: Hides are used as sleeping mats.
Sealskins are used as pokes to store food. Wild
grasses are made into baskets and mats.

In the face of these threats, the requisite TK and skills
needed to keep subsistence as an important source
of livelihood must be deliberately used, protected

• Sharing: Fish and wildlife are widely given out
to support neighbors who cannot harvest for

32

SECTION V
development of unique tribal policies to inventory
and protect and utilize TK.85 Best practices for these
inventories include onsite interviews with willing
informants, questionnaires, facilitated workshops,
collaborative field projects, and review of historical
documents. Protocols for these are well developed.86
It should be made clear that such inventories are not
being conducted for any purely academic or historical
purpose; rather, they should be completed primarily
for the purposes of facilitating dissemination of TK to
Alaska Native youth.

and restored as a matter of public policy rather than
ignored or – worse yet – ostracized. Otherwise, active
TK may slip into dormancy (persisting in memories,
written texts, or oral traditions but not used), and,
eventually extinction,82 especially as climate change
alters the landscape in unpredictable ways. Protecting
and restoring TK is not only critical for sustaining
livelihoods, but can be an important tool for reversing
cultural alienation and its attendant effects on mental
health and well-being.83 Policy interventions could be
used to scale up a number of successful, ongoing
initiatives, such as:

Dissemination and
training

Knowledge inventories
The need to preserve and utilize TK in natural resource
management decisions has been long recognized by
federal and state agencies in Alaska.84 The Alaska
Native Science Commission has called upon the EPA
and other federal agencies to provide resources for

Alaska Natives, as others in the indigenous world,
rely on oral transmission for passing on TK to the
next generation. However, a more deliberate system
designed to preserve and enhance TK could include

—CASE STUDY—
First Indigenous-owned video
game developer and publisher
A collaboration with Upper One Games, the “first indigenous-owned video game developer and
publisher in US history”79 established by the Cook Inlet Tribal Council, and education video game
company E-Line Media, resulted in the creation of the innovative video game “Never Alone”, also
known as “Kisima Innitchuna”.
A group of video game developers, an Alaska Native writer, and about over a dozen Iñupiat
storytellers and elders worked together to create the story of Nuna, a young Iñupiat girl and Fox,
her Arctic fox companion on their quest. Along the way, many characters from Iñupiat legends are
woven into the story, which is narrated all in Iñupiaq. The game can be played by a single player
or two together. The proceeds from the sale of the game benefit the Cook Inlet Tribal Council’s
education efforts.

33

SECTION V

Incorporating
traditional knowledge
into climate change
research

online resources, curricula, and educator training.
The Alaska Native Knowledge Network presents a
working model by providing resources for compiling
and exchanging information related to Alaska Native
knowledge systems and ways of knowing.87 They
provide cultural atlases and talking maps, cultural
resources (such as dictionaries and study guides),
books and other publications, curricula and links to
Native educator associations.

Several studies conducted with Indigenous peoples
in northern regions suggest that TK allows them to
account for and adapt to large numbers of variations
in their environment, including those associated with
recent climate change. As such, the detection of
environmental changes, the development of strategies
to adapt to these changes, and the implementation
of sustainable land-management principles are all
important climate action items that can be informed
by TK.90 For example, the Alaska Native Tribal Health
Consortium documents the impacts of climate
change on the landscape and on human health and
also develops adaptation strategies. In doing so,
they employ western science, traditional ecological
knowledge, and a vast network of “Local Environmental
Observers” to develop comprehensive, communityscaled climate change health assessments.91

Technological
enhancements
One strategy for preserving and restoring TK is to
complement its use with technology and western
scientific methods. The merging of traditional
ecological knowledge and western science “could
improve efficiency of management decisions and
enhance the validity and robustness of ecological
inferences.”88 For example, in northern Canada,
researchers compared caribou habitat modeling
approaches using GPS vs. traditional ecological
knowledge and found that both approaches had
high model performance and successfully predicted
caribou occurrence. The results point out how TK can
be used in habitat modeling in situations where longterm ecological data is lacking. In 2006 researchers
initiated the Iglinitt Trails Project in Nunavut to gather
records of weather conditions and other observations
made by Inuit hunters and travelers. The Project used
this information to
study changes in ice
cover and how these
The merging
changes affect Inuit
communities. The
of traditional
project
mapped
ecological
travel
routes
using
integrated
knowledge and
snow
machinewestern science
mounted
GPS/
mobile
weather
“could improve
station/palm
pilot
efficiency of
technology.89

Community-based
monitoring
The Atlas of Community-Based Monitoring and
Traditional Knowledge in a Changing Arctic is an
interactive inventory of community monitoring
initiatives in the Arctic that combine scientific methods
with TK. The Atlas allows communities to connect
with one another and get a sense of the big picture of
climate change in the Arctic. The Atlas was developed
as an environmental monitoring catalog, however it
is used to document and map social and economic
initiatives as well.92 Alaska has hundreds of recorded
projects in the online Atlas including local observer
networks, suicide prevention programs, community
health monitoring, and ecological knowledge coops.93

management
decisions and
enhance the validity
and robustness
of ecological
inferences.”

For example, the Arctic Borderlands Ecological
Knowledge Co-op is a multi-community initiative that
monitors the Porcupine Caribou Herd. The program
was initiated by tribal and First Nations residents
who conduct 20 structured interviews per year and
has produced annual reports since 2000. Indigenous
leaders had pressed for the International Porcupine

34

SECTION V
Caribou Agreement of 1987 due to concerns about
• 20–25% of workers engage in telework at least
94
caribou habitat and management. The Sea Ice
occasionally.
Monitoring Network trains local sea ice monitors
• 80-90% of workers say they would like
and sends them out twice per year to
to telework, at least part-time.
document freeze-up and melt. The
Local Environmental Observation
•
The average teleworker
(LEO)
Network
monitors
in the U.S. has a college deextreme and unusual events
gree, and earns $58,000 per
and data is posted to a
year.
shared Google Map. The
LEO is active across 108
•
In 2014, the
Alaskan communities.
number of teleworkers
The
communitygrew 5.6 percent, while
based
Permafrost
the total number of
and
Active
Layer
workers grew 1.9 perMonitoring Program
cent.
monitors the thermal
•
3.7 million workstate of permafrost
ers,
or
2.8
percent of the
and is active across all
Sunset
over
the
city
of
Utqiaġvik
total,
work
from home at
Arctic states. Federal
(Barrow),
Alaska,
silhouetting
least half the time.
investment
in
these
swings
in
a
play
area.
(Rose
types of programs could
• A higher percentage of
Sjölander / 70°)
employ local residents and
men telework than women.
significantly
enhance
the
working knowledge of various
• Two-thirds of employers algovernment agencies.95
lowed their workers to telework at least
part-time.

Investing in the workat-home economy

• Policies allowing workers to telework can help
employers attract and retain workers.
Telework has a significant, expanding presence in
Alaska. In 2011, 61,000 Alaskan adults, or 17 percent
of the workforce, used the Internet to work from home
instead of commuting to their workplace.99 Another
90,000 employed adults said they would telework
if allowed by their employer. Improved broadband
access, dissemination of work-at-home job skills,
and locally created entrepreneurial jobs are vital
components of an economic development strategy to
take advantage of this potential.

Participation in telework (the practice of working
from home, rather than commuting, by making use
of the internet and telephone) is growing especially
rapidly. The 2010 census found that, across the U.S.,
13.4 million people, or 9.4 percent of the workforce,
worked at home at least one day per week.96 About
60 percent of work-from-home workers worked
for a private company and 5 percent worked for a
government.97 This group grew almost 10 percent
per year since 2005. The other 35 percent were selfemployed, and their numbers declined slightly. Of
all the workers who worked from home, 9.4 million
worked exclusively from home, and the remainder
worked both at home and at the job site. Data from
Braverman (2014), and GlobalWorkplaceAnalytics.
com (2016), show that:98

Broadband access
A lack of access to broadband Internet service
impedes growth in telework in many parts of Alaska. In
2011, 27 percent of Alaskans did not have broadband
at home. Six thousand businesses didn’t have
broadband access. The average download speeds in
Alaska do not exceed 5 mbps.100 Limited broadband
also impedes economic growth across the board in
all sectors.

• From 2005 to 2014, the total number of teleworkers
more than doubled.
• One-half of jobs in the U.S. are now compatible
with telework.

In rural areas of the state, a 10 percent increase in

35

SECTION V

Skills and training

access to broadband might accelerate growth in
jobs and incomes by 1.4 percent.101 These economic
development benefits would materialize as improved
communication increases workers’ efficiency;
improves the effectiveness of services, such as
remote healthcare and online learning; enables rural
producers to reach a larger set of suppliers and buyers
electronically; and reduces barriers that contribute to
inequities among different groups of Alaskans.

Improved online access is one important strategy
for investing in the work-at-home economy. Another
is to scale up projects that seek to bolster workat-home skills and training. Alaska’s Workforce
Investment Board’s Strategic Plan recognizes this
need and includes goals to “expand access to shortterm secondary and postsecondary training and
registered apprenticeships through investments in
interactive technology, distance delivery, intensive
seminars and correspondence programs.”105 There
are many examples that can serve as blueprints for
scaling up state investments. For example, in 2014,
Bethel Broadcasting was awarded a $780,000 grant
from the USDA’s Strikeforce for Rural Growth and
Opportunity to transition to digital technology and
provide advanced education resources and technical
training to its viewers in remote villages. According
to USDA’s Patrice Kunesh,“[t]his newer, digital
technology will give rural Alaskans more access to
advanced teaching resources. It also will help them
in their career goals as well as help expand their local
economies.”106

Alaska’s Statewide Broadband Task Force offers
a blueprint for expanding broadband service
and exploiting it to generate jobs and to improve
education and public safety services.102 Overall, the
Task Force defined two goals: 1) “[m]ake it possible
for Alaskans to participate and be competitive in the
global community by extending the full benefits of
broadband technology to every Alaskan” and 2) “[b]y
2020, every Alaska household should have access to
100 megabits per second connectivity.”
Its recommendations include guidelines for the
technical specifications of an expanded broadband
system, and a general framework of public and private
institutions to develop and manage the system. As the
system evolves, the blueprint calls for:

The three main campuses of the University of Alaska
System provide both undergraduate and graduate
degrees as well as certificates, occupational
endorsements and courses that may be completed
entirely online or in blended formats. The Alaska
Department of Labor and Workforce Development’s
(DLWD) Mature Alaskans Seeking Skills Training
(MASST) program is designed to foster individual
economic self-sufficiency and promote useful
opportunities in community service activities that
shall include community service employment for
unemployed low-income persons who are age 55 or
older. The MASST program includes many work-athome arrangements.

• Policies
and
procedures
to
encourage
development of data centers and other industries
that can take advantage of the system and create
sustainable jobs for Alaska’s workers.
• Training programs for knowledge workers,
technicians, entrepreneurs, and small businesses.
• Incentives for Alaska-based innovators to patent
their innovations.
• Development of e-learning resources that involve
educational institutions and are available to
students throughout Alaska.
• Reinforce communications networks for public
safety institutions and individuals.
• The Task Force estimated that accomplishing its
two goals by 2020 would cost more than $1.2
billion.

Another important model that could be reconfigured
and scaled up is the DLWD’s Vocational Rehabilitation
(DVR) program, which is designed to nurture
self-employment opportunities for disabled or
disadvantaged persons through a number of services,
such as:107

Private companies are beginning to rise to the
challenge. For example, Quintillion plans to offer
broadband to five coastal communities by early
2017 (Nome, Kotzebue, Point Hope, Barrow, and
Wainwright).103 But service to other areas may require
federal or state subsidies, such as financial aid offered
by the Federal Communications Commission under
its universal service program104, or the development
of member-owned broadband cooperatives, such as
those being developed in other rural areas of the U.S.

• Technical assistance and other consultation
services to conduct market analyses and develop
business plans.
• Training for the management of a small business.
• Obtaining necessary initial stocks and or supplies.
• Assistance with marketing including the costs

36

SECTION V

Education, health, and
cultural empowerment

associated with custom web site design,
development, maintenance, and E-commerce
development within specified time frames;
• Assistance with accounting costs and financial
reviews.

Investments in formal education and job skills are
critical development tools for sustainability, and there
are many initiatives at the state, local, and tribal level
in Alaska that reflect this. It is beyond the scope of
this report to provide an inventory or evaluation of
such programs. However, we can call attention to the
health and cultural aspects of human capital since
they are often neglected as well as a special focus
on youth, rural Alaskans and Alaska Natives since the
needs of these populations are the greatest. Some
important examples of successful programs and
projects that illustrate the human capital benefits of
work in this space include:

• Providing appropriate accommodations or
assistive technology needed by the individual.
• Rent assistance and required security deposits.
• Referral to and coordination with community
resources for basic business courses, assistance
in the development of a business plan, and
assistance with business start-up practices.
• Referral to resources for small business loans.
• Acquiring licenses and permits required to lawfully
engage in business.

Youth empowerment

These programs could be broadened to include
anyone seeking a work-at-home arrangement. When
looking at a just transition beyond fossil fuels, this
is an area the state could invest in heavily, given the
growth potential of this sector and Alaska’s need to
find replacement employment for oil and gas workers.

There are several very successful youth empowerment
programs in the State of Alaska that cater to Native
youth education and traditional livelihoods training.
The Alaska Native Heritage Center runs programs for

middle school and high school students that provide
after school native culture classes and activities.
These programs help students academically, allow
them to earn school credit, and engage them in their
cultural history and traditions.108

Alaska has the highest rate of suicide per capita in the
United States. In 2014, the rate of suicide for Alaskan
residents was 22.3 per 100,000 and the rate for Native
Alaskan men (the most at-risk group) was 50.9 per
100,000.113 There are, however, initiatives that are
working to address this. Among them, the Teck John
Baker Youth Leaders Program began in 2009 in the
NW Arctic Borough School District as a peer education
and mentoring program. It has been successful in
reducing the suicide rate in the borough. The number
of teen suicides decreased from eight in 2008 to 5 in
2009 and has dropped and remained at zero every
year since. As of 2015, over 125 students have served
as social captains in the program. Youth Leaders are
training as peer counselors and gatekeepers. They are
taught anger management, coping, refusal, decisionmaking and interpersonal skills.114

There are many science and culture camps that link
elders and youth on their traditional lands and waters
for teaching and sharing knowledge, with many for
communities near national parks and refuges. For
example the Selawik National Wildlife Refuge partners
with the Northwest Arctic Borough School District for a
camp for K-12 students.109 The Alaska Native Science
and Engineering Program (ANSEP) offers three levels
of summer programming aimed at increasing the
number of Native Alaskans in STEM fields. It is the
most successful and cost effective STEM education
program in the United States. The programs begin
in the 6th grade and continue through the college
level. Middle schoolers participate in the Acceleration
Academy, where 95 percent of graduates advance
one level or more in math or science each summer.

Holistic healthcare

Middle schoolers can also take part in Middle School
Academy, which is a career exploration program
Healthcare initiatives that include Indigenous and
that is expected to serve 650 kids by 2018. Seventynatural alternatives work well in Alaska for those who
five percent of ANSEP middle schoolers complete
cannot always access conventional western
Algebra I before graduating from 8th grade.
medical facilities or treatments and
The Summer Bridge Program for high
who prefer integrated approaches
schoolers has over 250 participants,
to wellbeing. The Southcentral
90 percent of whom continued
Foundation is an example. The
on to engineering or science
There
are
many
Southcentral Foundation is a
B.S. programs in college. More
science and culture
Native-owned and led nonthan 75 percent of ANSEP
profit healthcare provider. The
students enrolled in a science
camps that link elders and
Foundation specializes in the
or engineering B.S. program in
youth on their traditional
Nuka System of Care that
2010 are still enrolled in those
combines physical, mental,
programs or have graduated
lands and waters for
110
and spiritual wellness with
from college.
teaching and sharing
traditional medicine and social/
knowledge...
behavioral care. According to
a number of performance and
quality measures, Southcentral
is outperforming other providers in
Alaska grants funding to remote
Alaska. In the past ten years, Southcentral
communities to develop telemedicine
has recorded a reduction in costs as well as in
capabilities through installing new technologies
average hospital days, ER and Urgent Care visits.
and educating residents. Many small communities
Southcentral highlights the importance of holistic
in Alaska have no dedicated doctors and nurses,
medicine and serves over 140,000 Alaskans.115
and without telemedicine residents either travel
Southcentral is supported through national and
long distances for medical care or forego it. Teleregional grants.
psychiatry is especially important for youth in Northern
communities where instances of depression and
suicide are high.111 USDA grants awarded to Alaskan
communities for telemedicine and distance learning
amounted to almost $1 million in 2015.112

Telemedicine

38

SECTION V

Thematic area 2: energy efficiency and renewables
While Alaska’s small population means it is not a major
energy consumer—ranking 40th in the country in 2014—
on a per capita basis, Alaska’s energy consumption is
significant. For residential consumption of energy per
capita, Alaska is 39th in the country,116 but including
all sectors Alaska had the fourth largest per capita
energy consumption nationally in 2014, at 818 million
BTUs consumed per capita. According to the U.S.
Energy Information Administration: 55 percent
was consumed by the industrial sector in 2015; 27
percent for the transportation sector; 11 percent for
the commercial sector; and 8 percent for residential
consumption. Alaska is the number one consumer of
energy per capita for transportation in the country,
with the largest consumption of jet fuel per capita.
However, given that Alaska is a major jet-refueling hub
for military aircraft
and
commercial
passenger and cargo
flights
between
the U.S. and Asian
countries, and that
many communities
in Alaska can only be
reached via aircraft,
this figure is not too
surprising.
Alaska
is the fourth largest
industrial
energy
consumer per capita
in the country and the
fourth largest energy
consumer per capita
in the commercial
sector.

comprehensive communications about the projects,
will help boost Alaska’s position as a model region
for piloting new technologies and will create local job
training and development opportunities.

Energy efficiency
As all renewable energy proponents will tell you,
energy efficiency is the first step in any renewable
energy portfolio. Unless existing energy consumption
is used efficiently, whether for industrial production,
transport, heating or lighting, any additional energy
– and money – will be wasted in proportion to that
efficiency. Yet Alaska has yet to take up the issue of
energy efficiency at the policy level with any real vigor.
A 2012 study of public facilities’ energy consumption
in Alaska found that the state spent an average
of $641 million on utilities each year, much of that
wasted on old, energy-inefficient buildings. The same
study suggested the state could save approximately
$125 million each year with greater building energy
efficiency.117 The Alaska Housing Finance Corporation
is working with schools and other public facilities on
energy efficiency upgrades, thereby saving the public
money while employing workers in the construction
trades.118

The Alaskan
energy
landscape is
composed of
more than 150
stand-alone
microgrids.

Alaska’s residential and commercial sectors consume
an estimated 440 trillion BTUs of energy for power and
space heat.119 Of this, 11 percent is used in residential
buildings, 14 percent is used in commercial buildings,
and 75 percent is used in industrial facilities. Alaska
Energy Authority (AEA) has set a goal of lowering the
cost of energy for Alaskans and improving energy
efficiency by 15 percent between 2010 and 2020,
with a focus on industrial, commercial, and public
buildings and electrical efficiency.120 Several initiatives
have been taken to help meet this goal. For example,
the AEA conducts commercial building energy audits
that have provided rebates for more than 230 privately
owned commercial buildings since 2011, identifying
an average of 28 percent energy and financial savings
for business owners.121 The AEA also conducts
outreach via the Village Energy Efficiency Program
(VEEP), which provides grants for energy efficiency
measures in public and tribal buildings.

The Alaskan energy landscape is composed of more
than 150 stand-alone microgrids in additional to
the large Railbelt electrical grid that stretches from
Fairbanks through Anchorage to the Kenai Peninsula.
The Railbelt electrical grid provides 80 percent of the
state’s electrical energy. Of the fossil fuels, natural
gas is the predominant source of energy consumed
in Alaska, with 329 billion cubic feet of natural gas
consumed, 41.6 million barrels of oil consumed, and
1.2 million short tons of coal consumed in the state in
2014. As elsewhere in the US where climate goals are in
focus, substantial investments in energy efficiency and
renewable energy will be needed to make significant
cuts in this fossil fuel consumption while allowing for
economic growth. Federal and state investment in
efficiency and clean energy projects combined with

In 2010, the Alaska Housing Finance Corporation
initiated a program involving a $250 million revolving
loan fund which provides financing for permanent

39

SECTION V
energy efficiency improvements for publicly owned
buildings in the state. Additionally, the Alaska
Department of Transportation and Public Facilities
has improved the energy efficiency of more than 25
percent of state-owned facilities, saving the state
more than $2.4 million.122 For residential buildings, key
findings in a 2014 Housing Assessment conducted
by the Cold Climate Research Center identified
three major challenges: (1) more than one in three
households in Alaska spends more than 30 percent
of their income on heat and electricity; (2) the average
housing unit in Alaska uses more than twice as much
energy per year as the average housing unit located
in cold climate regions elsewhere in the U.S., and (3)
over 19,000 homes in Alaska were rated at the lowest
energy rating a home can have.123

renewable energy projects came online, replacing
an estimated 22 million gallons of diesel fuel at an
estimated value of almost $61 million, and the AEA
estimates that even more than that will be replaced by
projects in 2016. Compare this to the 287 qualifying
projects that the state legislature appropriated funding
to in 2008, and one can see the enormous potential for
renewable energy development in the state.127
Alaska is already a national leader on “islanded
microgrids,” small electricity distribution systems that
contain localized load, generation and storage systems
to power electricity independent of connection to a
larger grid. However, for many decades, the power
source for these microgrids has been largely diesel,
which has proven to be both expensive and polluting.
It is the incentive to spend less on diesel fuel, together
with Alaska’s lack of energy infrastructure in rural
areas, that makes renewable energy an ideal option
for communities that want to achieve multiple goals:
The generation of stably-priced, environmentally
responsible, secure, and locally controlled energy.

Budget cuts have forced the Alaska Housing Finance
Corporation to significantly curtail two residential
energy efficiency programs: Home Energy Rebate
Program and Weatherization. From 2008 to 2015, these
two programs improved the energy efficiency of more
than 40,000 households across Alaska, “resulting in
an average energy savings of 30 percent, the creation
of more than 4,000 jobs, and an estimated $56 million
in energy saving to Alaskans per year.”124 Restoring
state funding and increasing federal funding for these
effective programs should be a high priority.

Upfront investments are starting to realize profits. For
example, thanks to funding from the Renewable Energy
Grant Fund created by the Alaska legislature, and
administered by the Alaska Energy Authority, capital
costs of $494 million that went toward 54 renewable
energy projects in Alaska are realizing $1.24 billion of
lifecycle benefits, a benefit –cost ratio of 2.5.128

Renewable Energy

} Wind

In 2009, former Governor Sarah Palin set a nonbinding goal to generate 50 percent of the state’s
electricity from renewable sources by 2025. Lauded by
environmentalists at the time, it was later revealed that
Palin had intended the vast majority of the state’s future
renewable energy resources to be derived from the
Susitna-Watana Dam, a megaproject that would pose
long-term risks to wild salmon and other environmental
impacts and was mothballed by Governor Bill Walker
in 2016 due to budget constraints.125 Indeed, today, the
vast majority of Alaska’s “renewable energy” is derived
from large hydropower. Of the electricity produced in
Alaska as of April 2016, 13.2 percent is petroleum-fired,
45 percent is gas-fired, 6.7 percent is coal-fired, 20
percent comes from hydropower, and 15.2 percent is
from wind, solar and other “renewable” energy.126 With
the Susitna-Watana dam off the table, the 2009 energy
goal is no longer being pursued with any vigor.

Alaska has enormous wind energy potential but,
due to failed experiments with early wind technology
in the 1980s, relatively few windmills have been
developed in the state. There are currently over 40
wind projects in Alaska, mostly located in western and
coastal regions where gusts are strong. Total installed
capacity is 67 megawatts.129 Several communities
have harnessed wind power as a secondary source of
energy production to supplement diesel and a few are
beginning to explore supplementing other forms of
energy as well, like hydropower. For example, through
state and federal grants, Kotzebue has installed a
total of 19 wind turbines that provide 60-65% of the
town’s electricity needs and saved nearly $900,000
in annual diesel fuel costs.130 In 2009, Kodiak Electric
Association installed the state’s first megawatt-scale
turbines. There are now six 1.5 MW turbines and a 3
MW battery system to store excess wind power on
Kodiak that supply the island with over 14 percent of
its electricity; the remaining electricity comes from
the Terror Lake hydropower facility.131 The utility has
saved over $22 million as a result of not using diesel

However, with the continued focus on reducing the high
cost of energy, which is often diesel fuel that is barged
or flown into remote villages, many renewable energy
projects are developing across the state. In 2015, 54

40

SECTION V
an installed capacity of 8.4 kW and is expected to
save over 12,000 gallons of diesel over the next 10
years.134 But perhaps Alaska could learn some solar
ambitions from the village of Batagay, Russia, which
has installed 1 megawatt of solar, one of the largest
solar power installations above the Arctic Circle.135

power roughly half the year, which has resulted in
lower utility rates for its customers.132
And there are many other examples of wind
installations, mostly wind-diesel hybrids, including
projects underway in the Railbelt region and scattered
across the state to power many of the Alaska’s
microgrids. These projects reduce the villages’
reliance on imported diesel and the total energy
costs for utilities and customers. Sustained state and
federal funding is needed for more wind installation –
among many local benefits, this could bring local long
term job development to villages and foster regional
expertise in remote wind development that could be
marketable elsewhere.

} Hydroelectric
Hydroelectric power is the most popular form
of renewable energy in Alaska and makes up
approximately 20 percent of the state’s energy
profile.136
Unfortunately,
much
of
Alaska’s
hydropower comes from decades-old dams that
are environmentally costly and interrupt the natural
flow of Alaska’s rivers and salmon runs. There are a
number of hydro projects in the state that use run-ofthe-river technology or river diversion, which is gentler
on the environment than dam technology, but offers
less storage potential. This lower impact technology
is expected to grow as a means of displacing more
expensive gas and diesel power.137

} Solar
Alaska’s northern latitude leads many to believe it is
a region inhospitable to solar power. Yet, as a recent
study released by the U.S. Department of Energy
points out,133 Alaska’s insolation is actually far greater
than Germany’s, a country that has 35 gigawatts of
installed solar capacity, and is on track to produce
52 gigawatts of solar, representing about 7 percent of
the country’s power production. During the summer,
as in Germany, Alaska’s 20+ hours of sunlight, make
solar energy a reliable source of energy. However,
solar energy is less accessible during Alaska’s long
and dark winters. Nevertheless, the DOE study
found that there were several scenarios where solar
(photovoltaic) PV was economically competitive
with diesel fuel and suggested that solar had a role
to play in reducing rural villages’ reliance on diesel
power or possibly in supplementing wind power. The
most productive months for solar energy in Alaska
vary by region from March to August, when the PV
panels receive both direct sunlight and reflected light
from snow. During cooler months, temperatures are
low enough for the PV systems to exceed their rated
output. Solar power in Alaska is also being used to
heat water (solar thermal heating) and as passive
heating.

The South Fork Black Bear run-of-the-river project
was constructed in 2004-2005 and supplies 2 MW to
supplement the 4.5 MW Black Bear Lake Hydroelectric
plant, supplying power to Prince of Wales Island.
The Black Bear complex was the first hydro project
in Alaska to be certified as low-impact by the Low
Impact Hydropower Institute.138 Another low impact
project is the Goat Lake hydroelectric facility, which
is a dam-less reservoir, providing power to Skagway
and Haines – operating at a 4 MW capacity.139

} Hydrokinetic (river, tidal, wave)
Hydrokinetic river energy – energy captured from the
power of flowing water in rivers (and ocean currents) holds great promise for Alaska, which has 17.1 percent
of the country’s total.140
Alaska has approximately 90 percent of the total
tidal energy in the country, given the large range of
tides experienced throughout the state.144 However,
slow developments in technology and the lengthy
permitting process have impeded progress toward
harnessing marine and hydrokinetic power. One
place with potential, however, is the Turnagain Arm,
which has tides as high as 40 feet, and where project
developers hope to install 240 megawatts of power.
The Turnagain Arm Tidal Energy Corp.’s project
received its preliminary permit in February 2014.145

There are 24 installed solar projects in the state, many
of which are clustered near each other in towns where
solar has become popular. For example, Kotzebue
has three solar installations with a combined capacity
of 22 kW and the community of Galena has multiple
projects with a combined 40 kW capacity installed
on schools, business, and residences between
2009 and 2014. Ambler, AK is the home to the first
solar installation in the Arctic Northwest under the
Coastal Impact Assistance Program. The project has

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—CASE STUDY—
Harnessing the Energy Potential of the Kvichak River
After successfully piloting a hydrokinetic power project in Maine, Ocean Renewable Power Project
deployed its turbine in the Kvichak River, near the village of Iguigig, Alaska in July 2015.141 In March
2016, Igiugig was selected by the Department of Energy to receive up to $1.5 million to advance
the design and operation of the system.

The 25 kilowatts of power being generated by the hydrokinetic energy is displacing diesel fuel
that would otherwise be used for power in the village at a cost of $0.80 per kilowatt hour, nearly
eight times the cost of power elsewhere in the U.S.142 There has been no observed evidence of
fish mortality as a result of the river turbine, and other communities, like Nenana are beginning to
explore a similar technological approach.143

The RivGen® turbine in the Kvichak River provides power to the Village of Igiugig. (U.S. Department of Energy)

This may follow the example of Penzhin Bay, Russia
– at a latitude similar to Turnagain Arm and with
the highest tides in the Pacific Ocean at 44 feet,146
tidal energy is being explored there with the goal of
installing 87 gigawatts of energy.

industry opportunities, and encourage renewable
market transformation in electrification of end-use
energy demand and conversion from fossil fuel to renewable fuels for transportation.”147

As one energy analyst put it: “If [Turnagain Arm and
other] tidal power configurations achieve the commercial break-through purported in their preliminary
permit applications with FERC and successfully navigate the permitting process, they may have the potential to be ‘game changing’ renewable opportunities
that substantially displace fossil fuels, position Alaska
as a world leader in tidal power technology, provide
extremely competitive electric rates for the northern
Pacific Rim which could significantly enhance export

} Wave
Wave energy in Alaska holds promise for some
remote communities. The community of Yakutat, for
example, is completely dependent on diesel for all of
its energy needs, burning 35,000 gallons of diesel per
month, and is exploring a wave energy project with
the Alaska Center for Energy and Power. Yakutat aims
to become the first community in North America to
generate electrical grid power from wave energy. In

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} Biomass

January of 2013, FERC approved a preliminary permit
from Resolute Marine Energy to test the wave energy
in the region and development research is underway.148

Alaska has great potential to use waste from wood,
sawmill waste, and other waste products to create
energy. While this method of energy generation is
often classified as renewable, it does release harmful
quantities of carbon dioxide and carbon monoxide
into the air and consists of burning organic materials.
However, some Alaskan communities have adopted
wood pellet (made from sawdust and other waste
wood) burning and biomass burning as a means
to reduce diesel use and energy costs.150 Other
communities have begun generating energy through
methane capture and heating greenhouses with
biomass powered boilers.

} Geothermal
Alaska has a huge potential to harness geothermal
energy, given its location on the volcanically active
‘Ring of Fire.’ In 1982, the USGS identified four
major regions that warranted further study for their
geothermal potential. These regions were the Interior
Hot Springs, the Southeast Hot Springs, the Wrangell
Mountains, and the Ring of Fire volcanoes.149 United
Technologies Corporation entered into a partnership
with Chena Hot Springs Resort to develop
the lowest temperature operating
geothermal power plant in the world
in Chena, Alaska in 2004. The
hot springs powers a resort
and several greenhouses
that are used to grow
hydroponic
vegetables
year-round.

} Landfill methane

Alaska has a
huge potential to
harness geothermal
energy, given its
location on the
volcanically active
‘Ring of Fire.’

capture

The
municipality
of
Anchorage and Doyon
Utilities have partnered
to initiate a program
for collecting methane
emissions from a local
landfill
to
generate
energy for Joint Base
Elmendorf-Richardson.
The 5.6 MW project
captures methane and
uses it to displace natural
gas and diesel. Thus far, the
project has generated over
100,000 MW hours of electricity
and displaced over 10 million gallons
of diesel. The methane power plant provides
over 25 percent of JB Elmendorf-Richardson’s
electrical demand.151

A similar proposal is in
the works for Pilgrim
Hot Springs, 60 miles
from Nome, Alaska.
Gwen Holdmann, the
project manager and
engineer at the Chena
Hot Springs site from
the University of Alaska at
Fairbanks, is also advising the
developers of the Pilgrim Hot
Springs site, to determine whether
or not that site might produce enough
power to develop another geothermal power
plant in the region.

Other promising locations currently being explored
for geothermal heat development are: Manley Hot
Springs which is 160 miles west of Fairbanks;
Granite Mountain near Buckland, Alaska, population
406; Division Hot Springs near Shungnak, Alaska,
population 256; and Tenakee Springs on Chichagof
Island in the Southeast.

Thematic area 3: greater

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SECTION V

local self-reliance in food and manufacturing
It is now widely accepted by sustainable development practitioners that after decades of almost zealous pursuit
far greater than any gains associated with cheaper
goods.153 This could be especially true in Alaska,
where local production actually has the potential
to lower costs, especially with food. Consumers
would receive the benefit of lower prices as well as
the benefit of knowing that their food was produced
locally and sustainably. Opportunities for local energy
production in Alaska were discussed above. Here, we
touch on the potential in two additional sectors: food
and manufacturing.

of free trade agreements and other strategies for
globalization it is time for nations, states, and cities to
embrace solutions that rebuild greater levels of local
self-reliance in the production of food, energy, and
manufactured goods. An economy that aligns local
demand for goods and services with local production
and local talent is one that generates a wide array
of socio-economic benefits for its population:152
(1) resiliency in the face of volatile global markets;
(2) more abundant and diverse job opportunities;
(3) a greater endowment of skills and knowledge;
(4) more capability to adapt and take advantage
of new economic opportunities as they arise; (5)
more accountable, environmentally sound, and
humanitarian business practices, and (6) more money
circulating locally.

Greater local self-reliance in food
Rural Alaskans are already among the most self-reliant
in food. Wild food harvests in rural regions range
from about 153 to 664 pounds per capita annually.154
By way of comparison, the average American in
the continental U.S. purchases about 222 pounds
per person of meat, fish, and poultry annually from
globalized markets. The highest levels of per-person
food harvest occurred in the Arctic and Western
Regions. If these subsistence foods were purchased

While it may be argued that self reliant economies
are inefficient – in the sense that they produce goods
and services that are more efficiently (and cheaply)
produced elsewhere – studies have consistently
documented that the externalized costs of an
economy overly invested in trade (i.e. unemployment,
accelerated environmental degradation) are often

—CASE STUDY—
Locally Grown Opportunity
A new approach to farming has begun to emerge in the Arctic: hydroponic farming. Arctic Greens,
located in Kotzebue, is the first company above the Arctic Circle to be certified as “Alaska Grown,”
and began selling produce to local grocery stores in June 2016.161 The company, owned by
Kikiktagruk Inupiat Corporation, has long-term plans to expand their operations to up to 30 other
communities in Alaska, including Nome.
In the Village of Anaktuvuk Pass, there has also been an agricultural venture with Gardens in the
Arctic, established by local resident Rainey Hopson with the purchase of a high tunnel greenhouse
that will enable up to 90 days of growing around the summer.
“A lot of people on the North Slope want to put money into something that will help the communities
so this is a way they can do it directly,” said Hopson.162
And in the southern part of the state, over 200 high tunnel greenhouses – the highest rate per
person in the US – can be found in the Kenai Peninsula partially funded by the US Department of
Agriculture’s Natural Resource Conservation Service.163

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SECTION V
Rhodiola rosea is a circumboreal herb consumed
as a supplement to treat fatigue, depression, and
infections, strengthen the immune system, and
protect the heart.164 It grows primarily in Arctic areas
of Europe, Asia, and North America. The herb is
becoming more popular in the mainstream herbal
industry. Cultivation has recently begun in Alaska after
extraordinary success in Alberta, Canada. The first
Alaska harvest was reported in 2013 from ten growers
with a commercial quantity of Rhodiola. The farming
experience in Alberta has led experts to estimate that
high-quality Rhodiola could yield $30,000 per acre.165
Climate change may adversely affect wild populations
through sea level rise and increased competition with
invasive species. Cultivation provides a new way to
ensure the species’ abundance and use for rapidly
growing medicinal markets.

in the market, they would have a value of over $900
million per year.155
But for those who live in urban areas and do not
engage in subsistence activities, and at times of
the year when subsistence foods are not available,
the opposite is true. Local fresh food is exceedingly
difficult to come by. One key reason is that producers
face a vicious cycle of high costs. The high cost of
living means farmers must pay a higher wage to
local laborers; the high cost of transporting food and
essential inputs affects the price of the foods; and,
as the price of oil has dropped, so too has the price
of transport of goods from the Lower 48, giving out
of state goods an additional competitive advantage.
Even seafood, which is plentiful in Alaska, is often
processed in Seattle then imported back to Alaska
for local consumption.

Schools are also playing a role in ramping up markets
for local fish. One of the more successful models to
emerge is the “Fish to Schools” initiative. A pilot project
in Sitka, Alaska, showed great promise, but relied on
fish donated by local fisherman.166 A recent subsidy
provided by USDA has allowed schools to purchase
local fish throughout the state, thereby supporting
the local fishing economy. With a recent three-year
grant from the U.S. Department of Agriculture, the
University of Alaska at Fairbanks researchers are
exploring how increased use of locally-caught fish in
the schools could have a range of health, educational
and community benefits.167

As a result of these challenges, Alaskans spend $2.5
billion each year on food, 95 percent of which is
imported from out of state, meaning up to $1.9 billion
is leaving the state each year that could be supporting
local producers.156 In 1955, over half of the food
consumed in Alaska was grown in-state.157 Today,
less than 5 percent is grown in-state. According to
the 2012 census, Alaska is ranked last in the value
of crops sold in the state. It ranks last or near last in
every category of food production except aquaculture,
where it is ranked 13th.158
To improve greater food security and sovereignty for
Alaskans, a recent report produced by the Alaska
Food Policy Council and the Alaska Department of
Health and Human Services recommends setting
aside “4,700 acres for all the potatoes that would be
needed, 200 acres for carrots, 200 more acres for
cabbage, and 600 acres for lettuce” with support
from the state. The report also recommends: fostering
subsistence harvesting; expanding expertise and
support for local food production; an increased
campaign to raise awareness among Alaskans of the
importance of purchasing goods grown in Alaska; and
expanding food processing, manufacturing, transport
and distribution networks for in-state consumption.159

Growing potential is high both outdoors and in. Some
schools in Alaska have begun to experiment with
programs where biomass burners, used to heat the
schools, are also providing heat for greenhouses,
allowing students to grow and harvest their own greens.
Among the benefits of this program: Schools have cut
their heating bills almost in half; the school pays local
community members to deliver cords of wood to the
boiler, thus keeping money in the community; students
are eating fresher, more nutritional food; students are
raising a crop the excess of which they can sell to
their community; and students are learning about the
business of farming and even, in some cases, running
a restaurant. In the Southeast Island School District,
they have created a student enterprise, “Island Fresh,”
which sells student-raised greens. So far, the students
have made over $50,000 in profits, moneys which
are then reused to help pay for student activities.168
Several other similar programs are now being put in
place in other schools in the region and the district
has purchased the only restaurant in Thorne Bay,
where they employ local students and sell food grown
locally, including the school’s greens.169

On the demand side, a promising new trend is
emerging in Alaska: locavores – or those who realize
the wide ranging benefits of consuming local foods
and who are changing their diets accordingly. As a
result, farmers markets are growing and with them,
smaller-scale farming operations of less than 50
acres.160
As the climate changes, new opportunities for
cultivation of foods and herbs will emerge. For example,

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and beverage manufacturing is a small but growing
sector with “serious potential for expansion.”172
Breweries were found to be the fastest growing type
of manufacturing; there are 25 registered with the
Brewers Guild. Alaskan manufacturers also make
food, specialty metals (for aviation and oil/gas), marine
vessels (repair and construction), and soaps.173 And
with the recent legalization of marijuana in the state,
there are new manufacturing opportunities as that
sector develops. Businesses in all these categories
can benefit from state interventions to help scale up
their operations and provide new opportunities as oil
and gas extraction tapers off.

As noted by the Alaska Food Policy council and
others, expanding expertise and support for local
food production is a critical strategy for achieving
food sovereignty and food security. One way to
achieve this is through knowledge-sharing platforms
that can be used by all Alaskans to grow food at
home, in their communities, or to bolster the efficacy
their subsistence hunting, fishing, and gathering
activities. An excellent example of such a knowledgesharing platform is maintained by Eat Local Alaska,
who maintains a website consolidating information
on eating “Alaska grown, produced, hunted, fished,
and foraged foods” including guidebooks and tutorial
videos.170

Schools have cut their heating bills almost in half... students are
raising a crop the excess of which they can sell to their community;
and students are learning about the business of farming and
even, in some cases, running a restaurant.
Priorities for state support identified by Alaska
manufacturers in the study include:

Greater local
self-reliance in
manufacturing

• “Shipping/freight assistance was seen as a major
need, from firms seeking to decrease transportation
costs and inefficiencies. This includes both the
sourcing of raw goods as well as movement of
finished products to outside markets.
• Energy efficiency is a major need given Alaska’s
high electricity and heating costs, particularly
outside of Southcentral Alaska and parts of
Southeast Alaska.
• Marketing assistance, including web development
and online marketing, is a need of many
manufacturers. While mainly a concern of smaller
manufacturers, several large firms also expressed
this need.
• ISO (International Organization for Standardization)
certification and Lean Manufacturing training were
identified by a small number of manufacturers
as needed services. Of interest, the companies
demanding these services were often larger and
displayed the most growth potential.
• HACCP (Hazard Analysis & Critical Control Points)
training was seen as a major need of the food and
beverage sector.”174

Manufacturing makes up approximately four percent
of Alaska’s Gross State Product and about the same
percent of employment. Growth and diversification of
this sector has large multiplier effects on other sectors.
According to the Bureau of Economic Analysis, every
dollar of new economic activity in the manufacturing
sector generates $1.33 worth of economic activity in
other sectors through indirect and induced effects as
spending circulates through a local economy. By way
of contrast, an additional dollar of economic activity in
the professional and business services sector yields
just $0.61 in indirect and induced economic activity.171
A recent study by the University of Alaska Center for
Economic Development found potential for significant
growth in manufacturing employment and income in
Alaska. Currently, the largest manufacturing sector by
employment is fish processing, although most jobs in
this field are low-wage and seasonal. But beer, wine,

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SECTION V
Another way the state can bolster markets for
Alaska goods is through marketing programs, such
as Alaska Department of Commerce, Community &
Economic Development’s Made in Alaska program,
to which vendors must apply and be accepted to the
program to use the symbol that designates a product
is derived from at least 51 percent Alaska goods.
Native craftspeople can apply to use the ‘Silver
Hand’ emblem to certify that the product was made
by an Alaska Native artisan and wherever possible,

products are made with Alaskan materials.175 Many
small-scale manufacturers benefit from the online
economy, which reduces the overhead costs of a
storefront and reaches a geographically diverse
audience. In Alaska, these companies would benefit
from greater web access and connectivity, innovative
online marketing, and state-wide exposure through
business development initiatives.

Thematic area 4: Dismantling, Rehabilitation and
Restoration (DR&R) of fossil fuel infrastructure sites
Decades of oil and gas extraction in Alaska have
created an immense network of infrastructure that
will need to be dismantled and removed and tens of
thousands of acres of affected lands and waters that
will need to be restored in accordance with federal
and state requirements to decommission, remove,
and restore (DR&R) infrastructure once extraction
activity ceases. The good news is that if the fossil
fuel industry follows through on these requirements,
DR&R spending will be more than adequate to sustain
nearly every job now at risk from phasing out oil
and gas production for well over a decade or more
assuming that adequate training can be put in place
to repurpose the existing workforce.

The three primary areas of concentrated infrastructure
include the North Slope, Cook Inlet, and the Trans
Alaska Pipeline.176 In the North Slope region, the oil
industry has developed Prudhoe Bay and 35 other
oil fields and directly filled with gravel, excavated,
or disturbed more than 18,300 acres of tundra
wetlands, rivers, and nearshore waters.177 The oil field
complex has drilled more than 6,000 exploratory and
production wells178 sited on 230 drill pads and 20
artificial offshore gravel islands, dug 36 gravel mines179
into more than 6,700 acres of tundra and rivers, and
built about 500 miles of roads, 500 miles of pipeline
corridors, 27 production centers and industrial
plants, 145 support pads, power stations and camps,
and 250 transportation centers (docks, causeways,
airstrips).180 Cook Inlet fossil fuel infrastructure
includes sixteen offshore platforms and associated
equipment, twenty-one onshore gas production
facilities, five onshore oil and gas processing facilities,
the Drift River Marine Terminal, and over 1,000 miles of
transmission, gathering, and distribution pipelines.181
The Trans Alaska Pipeline (TAPS) spans 800 miles
from Prudhoe Bay to Valdez and includes numerous
support facilities associated with communication,
emergency response and pumping as well as the
Valdez Marine Terminal at its endpoint.182

But the state must act swiftly to ensure that DR&R
funding is secured and spent wisely and that the
public is not saddled with financial liabilities as fossil
fuel companies shift ownership or leave the state. In
particular, DR&R obligations must be modernized to
eliminate risky financial assurance options like selfbonding (where a company merely invokes a ‘too big
to fail’ argument and is exempted from any third-party
guarantee of meeting its DR&R obligations), to clarify
what ecological standards restoration must meet,
to extend obligations to infrastructure like pipelines
or management buildings that will be abandoned
but for which DR&R requirements are non-existent
or ambiguous, and to ensure that DR&R activities
commence in a timely manner.

Current DR&R
requirements

Current extent of fossil
fuel infrastructure in
Alaska

In Alaska, a number of state agencies have authority
over DR&R requirements for fossil fuel infrastructure
either through statutes, regulations, or agreements
made with individual companies that hold leases on
public lands. But DR&R requirements are often vague,

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SECTION V
in” wells for long periods of time, leaving platforms in
a “lighthouse mode” where no DRR activities occur.

and so as fossil fuel infrastructure shut-down and
abandonment begins in earnest such requirements
need to be strengthened and clarified to ensure that
affected lands and waters are restored as best as
possible to their natural state.

Unit and lease agreements are similarly vague.
For example, each of the formal lease agreements
signed for Cook Inlet platforms contains the following
language pertaining to rights on termination: “[l]essee
shall deliver up said lands or such portion or portions
thereof in good order and condition.”186

The Alaska Oil and Gas Conservation Commission
(AOGCC) and the Department of Natural Resources
(DNR) are the two state agencies with primary
authority for regulating DR&R activities – however,
local jurisdictions including boroughs also have
DR&R authority.183 DNR provisions for DR&R are
typically contained in lease agreements. For example,
a 1962 lease in Cook Inlet for an offshore platform
requires removal of infrastructure within six months
of expiration or termination of the lease and specifies
that the site be returned in “good condition.”184 Alaska
Oil and Gas Conservation Commission (AOGCC)
regulations contain fairly explicit requirements for
plugging and abandonment of wells prior to expiration
of an owner’s leasing rights on affected State lands (20
AAC 25.105 – 20 AAC 25.172). However, requirements
related to platforms and the condition of affected
lands and waters are unclear.

To date, there has been no guidance published on
what does and does not constitute “good order and
condition.” Lease agreements also imply the State
may require measures in the context of DR&R meant
to ensure the prevention of waste and degradation of
land. In particular, leaseholders are required to “carry
out at Lessee’s expense all reasonable orders and
requirements of Lessor relative to the prevention of
waste and the preservation of said land.”187
DR&R obligations also overlap with requirements
related to rehabilitation plans. As part of operations
plans filed for each of the offshore platforms,
leaseholders are required to include “plans for
rehabilitation of the affected unit area after completion
of operations or phases of those operations” (11
AAC 83.346 d(3)). However, and as DOG notes, at
this point in time the nature of these rehabilitation
plans is insufficient for assessing the risk of DR&R
activities, the specific activities that will be performed
by operators, and the cost and timeframe of those
operations.

For example, in certain situations involving the shutdown of wells drilled from a beach, artificial island, or
shifting natural island, AOGCC must approve plans
for “maintaining the integrity of the location” (20 AAC
25.105.d). There is no further guidance clarifying
what is meant by “integrity” and how, if at all, this
requirement relates to DR&R. The application of
DR&R obligations to drilling wastes is another area
of uncertainty. For example, regulations associated
with annular disposal of drilling wastes require that
operators provide the AOGCC with information to
support a finding that the waste will be confined, will
not come to the surface or contaminate freshwater
(20 AAC 25.080 b(3)). Logically, if these standards
have not been met, they should be included in the
context of DR&R activities, but no such guidance is
currently in place.185

Due in part to all these overlapping provisions and
lack of clarity, and as part of its 2002 review of
DR&R obligations for existing oil wells, the General
Accounting Office affirmed that requirements for
surface restoration of areas now occupied by oil
and gas infrastructure are vague, and noted that
many other states have “more explicit requirements
that create a fixed obligation to fully restore the land
according to specific standards.”188

Requirements for offshore clearance of platforms
contain several exemptions that have direct bearing on
DR&R costs – i.e. requirements to remove the wellhead
equipment, casing, piling, and other obstructions to
a depth at least five feet unless otherwise approved
by the Commission as adequate to protect public
health and safety (20 AAC 25.172(b)). Other provisions
entirely exempt operators from infrastructure removal,
for instance, if a state agency “approves leaving the
platform in place” or approves a “different disposition
to facilitate a genuine beneficial use” (20 AAC 25.172(a);
(d)). Additionally, some operators opt to simply “shut-

Ecological restoration
of fossil fuel
infrastructure sites –
best practice
Know-how for effective restoration of sites occupied
and/or contaminated by fossil fuel infrastructure
is already in place. The World Bank, for example,

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SECTION V
has published a useful toolkit for sustainable
decommissioning and closure of oil fields and mines
that is in use internationally.189 In Alaska, Jorgenson
and Joyce (1994) evaluated the efficacy of six
strategies for rehabilitating lands degraded by oil and
gas development in the Arctic (specifically Alaska). The
six methods they investigated were: (1) flooding gravel
mines for fish habitat; (2) creating wetlands/perched
ponds on overburden stockpiles; (3) revegetating thick
gravel fill; (4) removing gravel fill to restore wet tundra;
(5) restoring tundra on less severely modified lands,
and (6) remediating areas contaminated by oil spills,
seawater spills, and drilling mud.190 Jorgenson and
Joyce’s methods are intended to create diverse and
productive habitats. At the time of publication, many
of these strategies were in the early phases of testing
and development. Now, however, these strategies
have been adopted by the Alaska Department of Fish
and Game and the Department of Natural Resources.

as a transition strategy in Alaska is huge. While the
composition, location, and timing of dismantlement,
removal, and remediation (DR&R) activities remains
unknown, several analyses indicate that it will require
spending billions of dollars spread over several
decades. This spending may generate patterns of jobs
and incomes similar to those experienced during the
development of the oil/gas industry. The U.S. Bureau
of Safety and Environmental Enforcement (BSEE) has
a study underway to estimate DR&R costs in Alaska.
The task is challenging insofar as Alaska has had
limited experience with DR&R activities, because
the industry’s infrastructure generally remains in
production. This study likely will consider the few
Alaska-specific indicators of the potential level of
spending:
• In 1985, the state and federal governments
reached a settlement with the owners of the
Trans-Alaska Pipeline, in which they agreed on the
expected DR&R cost for the pipeline: $872 million
in 1977 dollars.193 This amount, when adjusted
using the GDP price index, is equivalent to $2.7
billion in 2015 dollars.

According to Jorgenson and Joyce, rehabilitating
lands disturbed by oil and gas development is very
effective using the methods they outline. Jorgenson
and Joyce define successful restoration as an
ecosystem capable of supporting healthy vegetation
and plant life but it may not be restored to original
habitat conditions. Difficulties arise in areas with thick
gravel fill, where grasses and other vegetation struggle
to take root. In locations with thinner gravel cover,
fertilization is enough to promote habitat restoration.
Large-scale gravel removal has not proven to be costeffective.191

• The Bureau of Land Management estimated that
the total cost to plug and abandon more than 80
legacy wells in the National Petroleum Reserve in
Alaska would exceed $100 million.194
• DR&R costs for assets in Cook Inlet owned by
Pacific Energy Resources have been estimated to
total $50–$200 million.195

In parts of Alberta, legislators are exploring an
innovative approach to cleaning up thousands of
abandoned oil wells that involves repurposing the
wells to function as geothermal plants to power small
greenhouses, even in the winter. Project proponents
claim that with the energy industry providing some
of the costs for less than they would pay to clean
up the well, many of these wells can be converted
to geothermal-powered greenhouses. The job and
economic benefits for northern communities could
be quite significant.

• DR&R costs for 16 offshore platforms and 160 miles
of oil pipelines in Cook Inlet will range between
$402 million and $1.11 billion. Dismantling gas
pipelines and other infrastructure will require
additional spending.196
Experience elsewhere suggests the overall scope of
what may occur in Alaska:
• UK North Sea: the industry will dismantle 5,000
wells and related facilities over the next 30 years,
with a total cost of $61–$107 billion.197 These
numbers are equivalent to about 170 wells per
year, $1.2–$2.1 billion per well, and $2.0–$3.6
billion per year. Actual spending may be higher,
as average DR&R costs in the UK are increasing
about 14 percent per year.

The economic benefits
of DR&R

• Gulf of Mexico: DR&R costs run from $235,000 to
$4.6 million per rig in shallow water, and exceed
$50 million per rig in deep water.198

The World Bank estimates that 90 percent of offshore
oil and gas structures will need to be completely
removed in the coming decades.192 As a result, the
DR&R industry is booming, and its economic potential

• Pacific outer continental shelf (California): $64

49

SECTION V

What Alaska can do to
ensure that DR&R is
an effective transition
strategy

million per platform over the next 15 years, and
costs are escalating about 4 percent per year.199
The precise number and nature of jobs that will
be created in Alaska by DR&R spending remains
unclear because of the ambiguity over what activities
have to occur and when. However, with respect
to TAPS, a system owners’ environmental report
from 2001 contains a useful analysis of job impacts
of future DR&R spending. The report found that
spending roughly $2.6 billion mainly over a threeyear period would create an average of 3,497 jobs
in the construction, transportation, and services
sectors. Fewer workers over a longer time period
are possible, as well. But this level of employment is
more than enough to compensate for a reduction in
the operations workforce of roughly 1,800 at the time
the Prudhoe Bay oil fields and TAPS shuts down.200

To ensure that DR&R activities provide an effective
tool for a just transition in Alaska, there are several
actions decision makers can take at the state and
local levels. These include:
1. Expand fossil fuel infrastructure inventories so that
the state, boroughs, and municipalities all have the
most up to date information on the extent of fossil
fuel infrastructure in their jurisdictions. Relatively
complete inventories are available for the North
Slope, TAPS route, and Cook Inlet. But inventories
are lacking or largely incomplete elsewhere.

If we extend these figures to a statewide DR&R
expenditure tab of about $6 billion, it implies a direct
employment potential of roughly 7,000 jobs. We can
assume that the necessary skill sets are similar to
those needed to construct, maintain, and operate
the infrastructure that now exists, so the transition
possibilities here for the existing pool of roughly 5,300
oil and gas workers is high.

2. Request that fossil fuel infrastructure owners
work cooperatively to develop DR&R plans for all
infrastructure that is likely to become inoperative
as a result of phasing out oil and gas production
activities. Such plans should be as specific
as possible, and eliminate the ambiguity of
obligations under existing arrangements. These

Robert Thompson, a resident of Kaktovik and local polar bear guide. (Rose Sjölander / 70°)

50

SECTION V
plans should also include cost estimates. The
state as well as boroughs and municipalities all
have authority to negotiate DR&R activities with
fossil fuel infrastructure owners and so initiating
this process now while those companies are still
operating in state is critical. All infrastructure at risk
should be addressed, even if it not directly related
to production, transportation, or distribution.
In Anchorage, for example, there are concerns
over the dwindling workforce at ConocoPhillips
headquarters and the extensive vacant parking
spaces this is leaving behind. This land could
provide fertile ground for urban redevelopment or
green space if the sites were restored.201

favor of more secure assurances such as bonds
and trust funds managed by third parties.202
Financial assurances should match cost estimates
– otherwise, jurisdictions may have to pay for
DR&R activities out of general funds if fossil
fuel infrastructure owners default on their DR&R
obligations.203
4. Require fossil fuel infrastructure owners to
accelerate DR&R activities for idle infrastructure
no longer in use and explore the feasibility of
repurposing abandoned wells for geothermal
powered greenhouses. For example, in Cook
Inlet, there are several oil and gas platforms in
idle “lighthouse” mode that could generate an
immediate economic stimulus if DR&R activities
were initiated now. This could help compensate
for oil and gas job losses expected this year.

3. Evaluate existing financial assurance mechanisms
for adequacy. Given increasing concerns over
the financial viability of even the largest fossil
fuel companies – several major coal producers
went bankrupt in recent years – all forms of selfbonding or self-insurance should be terminated in

Thematic area 5: protecting and restoring natural
ecosystems
A healthy economy depends on a healthy ecosystem,
and so too do healthy communities and families.
Nowhere is this truer than in Alaska. The state’s land,
rivers, sea, wildlife, and fish support jobs, generate
incomes, provide families with food, and knit together
Alaska’s local, regional, and statewide cultures. The
right of Alaska native communities to traditional
subsistence use should be strongly defended and
expanded, and by working with those communities to
protect and restore natural ecosystems, Alaska can
benefit economically.

exceeds what they spend on them. A detailed survey
found that, in 2011, Alaska residents took 1,052,000
hunting trips and 5,991,000 trips to view wildlife.206
Trip participants who responded to the survey said
that the total value they placed on the enjoyment
they derived from the trips was 20–26 percent
greater than what they actually spent on them. This
difference constitutes a net economic benefit, i.e.,
an improvement in their economic wellbeing. The
average net benefit per person was $438 per hunting
trip and $268 per wildlife-viewing trip.

Some of the most apparent economic impacts occur
as residents and visitors spend money inside the
state on equipment, services, and transportation
related to fishing, hunting, and wildlife-viewing trips.
Spending on these items totals about $12.2 billion per
year (Table 4). This spending directly and indirectly
supports about 120,500 jobs—almost one-half of the
state’s total. The workers in these jobs earn about
$4.4 billion, more than one-fifth of the total income for
the state’s workers.204

Those who hunted or viewed wildlife typically took
more than one trip per year, and each trip involved
more than one person per household. On average,
each household that hunted realized a net economic
benefit of $4,828. Wildlife-viewing trips generated a
net benefit of $8,050 for the participating households.
Statewide, hunting and wildlife-viewing trips in 2011
increased the economic wellbeing of Alaskans by
more than $2 billion.
Many Alaskans enjoy additional value from the
state’s ecosystems by utilizing diverse subsistence
resources. As noted above, both Alaska Natives and
other Alaskans utilize subsistence resources for wild
foods, clothing, medicines, fuels, transportation,
construction, home goods, sharing, customary trade,

The economic importance of fish and wildlife—and
the ecosystems that support them—extends far
beyond what people spend to catch, hunt, or view
them. For most people who engage in these activities,
the enjoyment they derive from these activities

51

SECTION V
ceremonies and arts and crafts. One partial indicator
of the value of this wild food is the amount of money
households would have had to spend to purchase
equivalent goods from commercial sources. For wild
foods, the replacement-cost value was about $500
million in 2012.207 This amount is about one-quarter
of the total value of food Alaskans eat in a year, and
some research indicates that the replacement-cost
value of wild food is even larger.208, 209

Alaska’s ecosystems do more than generate benefits
for Alaskans via fishing, hunting, wildlife viewing,
and the provision of wild food and other subsistence
products. These contributions to the quality of life
influence the decisions of many to live and work in
Alaska. Across the state’s five regions, 50 to 70
percent of Alaskans stated, in response to a survey,
that wildlife and wildlife-related activities exert a “very
important” or “extremely important” influence on their
decision to live in Alaska (Figure 5). Only 3 to 7 percent
of Alaskan respondents to the survey said that wildlife
and wildlife related activities are “not important at all”
to their decision to live in Alaska.

The replacement-cost value of wild food addresses
only one aspect of the overall economic, social, and
cultural importance of subsistence activities. The
gathering, sharing, and use of wild food and other
subsistence products are core elements of Alaska’s
cultural heritage and of life in many communities. One
researcher describes this relationship in these terms:

This influence on household location, in turn,
affects the size and distribution of the region’s labor
force, household expenditures, business activity,
employment, and investments. To the extent that
households and businesses locate in this region
because they want to be closer to opportunities
to interact with its ecosystem amenities, it is
reasonable to attribute to these resources all their instate expenditures, and the jobs and incomes they
generate. These expenditures, jobs, and incomes can
materialize in all sectors of the economy. To ensure
that Alaskans continue to reap the economic benefits
of healthy aquatic and terrestrial ecosystems and that
its pristine environment can serve as a magnet for
new job opportunities, there are several areas where
policy interventions could make a difference:

“[P]eople who live in communities with a long
history of reciprocity and working together, are
better off because they have developed institutions
to weather rapid change. Conventional wisdom is
that life on the North Slope is better following the
oil discovery because there are jobs and money.
… [I]t is more likely that jobs and financial success
have come to the North Slope Inuit because they
have a long history of working together and been
able to incorporate economic development into
their culture. … The continued importance of
subsistence practices and its importance for
adapting to change means that aboriginal people
need to be at the center of discussions and policy
planning about the future of their regions.” 210

100%
90%
80%
70%
Extremely important

60%

Very important

50%

Moderately important

40%

Not very important

30%

Not important at all

20%
10%
0%

North

Interior

Southwest

Southcentral

Southeast

Region
Unknown

Figure 5: Importance of wildlife to Alaskans’ reasons for living in Alaska in 2011, by region of residence211

52

SECTION V

Planning for climate
change

could be mitigated through a number of interventions.
For example, in response for an increase in diseases
affecting marine mammals, researchers and
advocates have called for a predictive framework to
anticipate impacts of climate change on infectious
diseases, “especially in the Arctic where the climate
change signal is strongest and issues of food safety
are particularly acute among indigenous people who
rely on marine mammals for cultural and nutritional
subsistence.”213 A prototype for such a framework has
already been developed for terrestrial ecosystems,
and is being suggested as a template to extend
to marine areas.214 As another example, there is
widespread agreement among land managers on
the need to provide for migration corridors to allow
species free movement to occupy new lands and
waters as climate change unfolds.215 There is also
the need to provide more flexibility around timing of
hunting seasons in response to changing weather.

Climate change to date has harmed ecosystems
and their ability to produce economic benefits, and
research indicates that additional changes anticipated
in the future will cause even more harm. Of particular
concern are these expected impacts:212
• Changes in the habitat for and availability of wildlife.
For example: warmer temperatures enable shrubs
and trees to expand into the tundra, displacing
lichens, an important food source for caribou in
the winter.
• Reductions in sea ice affect the food supply for
walruses, polar bears, and other ice-dependent
species, and they also can make hunting more
difficult.

The key for identifying effective interventions is through
adaptation planning that engages all subsistence and
other users of Alaska’s wild ecosystems in specific
adaptation plans in areas that they use and enjoy.
As one example, the Naskapi Nation in the Canadian
Arctic teamed up with researchers from the University
of Montreal to complete an assessment of climate
change impacts on the caribou and other hunted
species and to identify a series of specific adaptation
measures that should be prioritized to maintain their
relationship to these species for their livelihood
and cultural identity.216 The community identified
adaptation actions and the time frame of actions in
the context of a Naskapi Climate Change Adaptation
Action Plan that applies across four sectors:
animals, hunting and travelling on the land, health
and wellbeing, culture and learning. Similar planning
exercises can be sponsored at the state, borough or
village level throughout Alaska.

• Warmer temperatures increase the risk of diseases
to fish and wildlife.
• Displacement by invasive species of native plants,
including plants important for subsistence uses.
• Displacement of or reduction in the size of some
local stocks of salmon and other temperaturesensitive fish species.
• Reductions in the populations of crabs, clams,
mussels, and other shellfish from increased ocean
acidification and warming.
• Reductions in populations of ducks and other
migratory birds as warming and changes in
precipitation cause small lakes to go dry.
• Increases in wildfires.
While there is little policy-makers can do to prevent
these impacts from occurring, deleterious impacts
on subsistence and other uses of wild ecosystems

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SECTION V

New protective
designations on land

Estimated peak employment was 45,000. These jobs
resulted in total labor income of $1.24 billion. Visitors
spent $1.7 billion in Alaska, most of it in the summer
months.219

The importance of new protective designations – done
in collaboration with Alaska Native communities so as
to ensure the protection of subsistence rights - like
wilderness areas or parks for Alaska’s economy cannot
be understated. Such areas – where ecosystems
are offered their highest level of protection against
harmful uses such as oil and gas development,
mining, logging, and roads – not only represent a
fundamental component of Alaskans’ quality of life,
but also represent a critical tool for maintaining and
protecting subsistence uses. Designated wilderness
areas offer one example.

While these economic impacts cannot be completely
attributed to the presence of designated wilderness,
wilderness characteristics are a significant driver
of Alaska visitation. In the summer 2001 Alaska
Visitor Statistics Program (AVSP) Visitor Opinion
Survey, specific questions regarding wilderness
were included. For over 80 percent of respondents,
Alaska’s wilderness character and the opportunity
to see or spend time in wilderness places influenced
their decision to come to Alaska and was an important
factor in trip planning. Wilderness was also important
to a decision to visit Alaska again in the future by 73
percent of respondents.220

Most Americans think of wilderness areas as places
almost entirely off limits to human uses – places where
nature is allowed to take its course and where people
are only occasional visitors. The main motivation for
designated wilderness areas in the Lower 48 states is
for non-consumptive purposes. But in Alaska things
are different. While designated wilderness areas
found in Alaska certainly have outstanding ecological
traits, much of it is managed differently and for the
benefit of local people and traditional uses.

All this suggests that candidates for wilderness
designation and other hot spots of biological diversity
should be protected as a tool for a sustainable
Alaska. There are many gaps in Alaska’s protected
area network worthy of attention by policy makers.
President Obama’s proposal to designate 1.55 million
acres of oil-prospective land as new wilderness in
the Arctic National Wildlife Refuge is one of the most
visible proposals in play. But there are many others.
For example, despite years of advocacy, the Chugach
National Forest is unique within the national forest
system in that it does not contain a single acre of
permanently protected wilderness.

“The most distinct difference is that these areas
are treasured by local residents not for their
wilderness character per se but for their economic
contributions by providing food and income through
hunting, fishing, fur production, and other traditional
activities. This enables local people to continue
their culture of living off the land and allows many
to avoid having to move to distant urban centers to
completely join the cash economy.”217

New protective
designations at sea

As such, designating new wilderness areas, parks,
wildlife refuges and other protective land use
categories is a tool for maintaining the subsistence
economy and achieving sustainable development
goals such as increased food security. But new
designations are not just of benefit to those who
participate in subsistence. Alaska’s tourism industry
is a major beneficiary. The Alaska visitor industry is
the only private sector basic industry that has grown
almost continuously since statehood and continues to
grow.218 Over 1.6 million visitors came to Alaska each
summer and 91 percent of them come primarily to see
the state’s mountains, glaciers, and wildlife. Alaska’s
visitor industry accounted for an estimated 37,800
full- and part-time jobs from May 2011 to April 2012,
including all direct, indirect, and induced employment.

Addition to Alaska’s network of marine protected areas
(MPAs) is another important sustainable development
strategy to scale up. Since 1976, the National Ocean
and Atmospheric Agency’s National Marine Fisheries
Service has managed federal fisheries (three to 200
miles offshore) off the coast of Alaska based on
recommendations from the North Pacific Fishery
Management Council.221 MPAs are one of their most
important policy tools. MPA’s are defined as “any area
of the marine environment that has been reserved
by Federal, State, tribal, territorial, or local laws or
regulations to provide lasting protection for part or all
of the natural and cultural resources therein.”222 Over
forty MPAs have been established across Alaska’s
coastline, including most of the state waters where
commercial fishing takes place. All MPA’s prohibit

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SECTION V
89 studies by Halpern (2004), overall changes due to
reserve creation were a doubling of densities, a near
tripling of biomass, a 31 percent increase in average
size, and a 23 percent increase in species richness.225

bottom trawls, which are highly destructive to local
ecosystems, and some MPAs virtually prohibit all
commercial fishing activities.223 While the effectiveness
of individual MPAs varies, taken together they provide
a strong tool for managing fisheries and conserving
marine animals, ranging from sea cucumbers to sea
lions.

The Alaska Department of Fish and Game issued a
report on July 18, 2002 with a set of recommendations
for a public process for establishing additional
marine protected areas (MPAs) in Alaska. These
recommendations were developed by a ten-member
task force of Alaska Department of Fish and Game
(ADFG) personnel as guidance for development
of an MPA policy by the Alaska Board of Fisheries.
These recommendations could form the basis of a
comprehensive approach to new MPAs, and help
refine management recommendations for MPA
proposals now in play.

MPAs provide a refuge for marine species that face
threats from overfishing and pollution and also
protect underwater habitats with high scenic values
for scuba divers. MPAs are a big draw for eco-tourism
ventures, but also enhance local fisheries by allowing
fish and other sea life within the MPA boundary and
adjacent waters to grow larger and more valuable for
commercial and subsistence fisher folk. According to
the Alaska Department of Fish and Game, evidence for
changes in size and abundance within and adjacent to
reserves is compelling.224 For example, in a review of

—CASE STUDY—
Adventure, wildlife, and hospitality
at Icy Strait
Surrounded by towering rainforest and the abundant waters of Port Frederick and Icy Strait, Icy
Strait Point is a destination that offers unparalleled access to adventure, wilderness, wildlife,
and genuine Native Tlingit hospitality. Located in Alaska’s largest Native Tlingit village of Hoonah
(about 35 miles west of Juneau), Icy Strait Point features 20+ exciting tours, a restored cannery
and museum, nature trails, restaurants, 100% Alaskan-owned retail shops, and a beach.
The 1930s Hoonah Packing Company facility has been converted into a museum, restaurant,
and shops. At the dock, traditionally garbed presenters offer a look at Huna Tlingit culture, along
with an indoor theatrical production. All local shops are owned by Alaskans. Alaska’s Wildest
Kitchen shows visitors the importance of salmon and subsistence fishing in the Tlingit culture
and features a culinary instruction space where local residents demonstrate how to fillet salmon
and halibut and turn them into burgers, spreads, casseroles, and grilled entrees. The local town
of Hoonah is a mile’s walk from Icy Strait Point and showcases contemporary Tlingit life.
Owned and operated by Huna Totem Corporation, Icy Strait Point is Alaska Native owned-andoperated and all profits directly support the local community. With roughly 85% of staff calling
Hoonah home, Icy Strait Point is dedicated to providing a one-of-a-kind experience for visitors by
sharing Alaska’s natural beauty and native culture. Icy Strait Point is renowned for its exemplary
responsible tourism practices and has received numerous awards since opening. 233

55

SECTION V

Thematic area 6: Indigenous tourism
to a greater awareness of the rich heritage of various
civilizations and in bringing about a better appreciation
of the inherent values of different cultures, thereby
contributing to the strengthening of peace in the
world.”232 Indigenous tourism fits cleanly within this
vision.

The year 2015 was a boom year for Alaska’s tourism
industry: A record 1.78 million out-of-state visitors
came to the state.226 Tourism brought in more revenue
- $136 million – to state and local government coffers
in 2015 than did the fishing ($121 million) or mining
industries ($119 million). Nevertheless, in 2016,
Alaska Governor Walker slashed state expenditures
for tourism to $1.5 million, one of the lowest levels of
state support ever.227

Due in part to the work of Indigenous tourism
organizations, tourism is becoming a major economic
and cultural driver for Indigenous communities
across the world. If managed carefully, the roughly
100,000 Alaska Native residents stand to benefit
from this expanded form of tourism. However, before
tourism can be a boon to Indigenous communities,
there must be some changes, both to encourage
greater awareness among tourists and to support
Alaska Native communities. Indigenous communities
continue to suffer the effects of colonization globally,
and Alaska is no exception. They are in a period of
healing and reclaiming human and land rights, an
important process that the tourism industry needs
to recognize. In Alaska, this precarious situation is
coupled with the need to preserve and protect a region
where climate change is bringing disproportionate
impacts to its peoples and their future livelihoods.

Most of Alaska’s visitors in 2015 – 56 percent– entered
and exited the state via cruise ship; 39 percent traveled
via air.228 Alaska’s tourism industry in 2015 showed
a more rapid growth than other areas of the U.S.229
As part of this, the potential growth of Indigenous
tourism among Alaska Native communities that want
to pursue its development holds both promise and
perils.
Indigenous tourism can be defined as responsible
tourism activity in which Indigenous people are directly
involved through control, ownership and guidance
over economic, cultural and natural resources, and
where tourism is part of a larger strategy of reinforcing
or revitalizing political and cultural autonomy through
intercultural encounters. Within this framework,
several factors are paramount, which include respect
for local cultures and their decision-making processes
as well as community or local control over the social
and natural resources involved.230 Indigenous tourism
shares much with responsible tourism, ecotourism,
sustainable tourism and other forms of alternatives to
destructive mainstream, mass tourism activities but
it is distinct in that it is in full control of Indigenous
Peoples and enhances their cultural and human rights.

Indigenous tourism development is a complex
process and its success to a large degree depends
upon hospitality-based skills development, access
and control of traditional resources and community
support. For any type of tourism-driven development
to be successful and effect positive change in the
economic, social and cultural dimensions, Native
communities must develop the capacity to undertake
these development initiatives themselves. There are
key investments state and local leaders can make to
enhance Indigenous tourism in Alaska, while avoiding
potential problems and pitfalls. Some of these are
listed below.

The demand for Indigenous tourism is skyrocketing,
and thus providing an important sustainable
development option for Alaska Natives. Indeed,
the Rio+20 process recognized that well-designed
and well-managed tourism could contribute to the
three dimensions (economic, environmental, social)
of sustainable development, to job creation and to
trade.231 The United Nations General Assembly has
approved the adoption of 2017 as the International
Year of Sustainable Tourism for Development
in a resolution that recognizes “the importance
of international tourism, and particularly of the
designation of an international year of sustainable
tourism for development, in fostering better
understanding among peoples everywhere, in leading

Cleaning up industrial
activity on Native lands
Existing extractive industrial activity on Native lands
must be cleaned up and planned extractive activity
must only proceed with the free, prior, informed
consent of Alaska’s Native peoples. Current threats
from extractive industries are a threat to the lands and

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SECTION V

With green
technologies
and
alternative
energy
integrated into
Indigenous
tourism
planning,
Alaska Native
businesses
could cut their
energy costs
while ensuring
the long-term
sustainability
of their
enterprises

Native peoples of Alaska
and thus an obstacle to
expanded
Indigenous
tourism. For example,
some
advocates
for
Indigenous tourism in the
Arctic complain that their
time and resources have
for decades been spent
fighting to keep the Arctic
National Wildlife Refuge off
limits to oil drilling, to the
detriment of their ability
to develop a far more
lucrative tourism industry
in the region.234 Mining
may bring some wealth to
local communities, but it
too often leaves behind a
toxic legacy and extracts
far more in mineral wealth
than it shares with state
and local governments.
According to the U.S.
Environmental Protection
Agency’s Toxics Release
Inventory, metal mining is
the nation’s number one
toxic polluter.235

relationship with energy.”237 With green technologies
and alternative energy integrated into Indigenous
tourism planning, Alaska Natives could create a winwin situation for themselves, cutting their own energy
costs while ensuring the long-term sustainability of
their enterprises.

Indigenous tourism
training
Iļisaġvik College in Utqiaġvik, Alaska, provides
training in tourism with an emphasis on tourism
opportunities on the North Slope. This includes
internships with hands-on experience in the growing
field of ecotourism. Another series of classes are
offered introducing students to the skills involved in
local guiding.238 Local Native guides in remote villages
point out that often the only additional guides who
can be insured to take on the work of, for example,
river rafting are not always local and often non-Native,
thus reducing opportunities for young local residents
to find employment.239 In order to expand the benefits
to Native communities, training and certification
programs targeting Alaska Natives should be
expanded in the guiding and hospitality sector.

Increased access to
financing

Faced with enormous
cleanup expenses, many
mining companies find
that it’s cheaper to simply
abandon their mines when
they are done - leaving them to pollute forever. Few
tourists—much less year-round inhabitants—choose
to spend time in toxic surroundings and Alaska Native
communities where such activities have taken place
should be the first targeted for cleanup. Should
continued mining activity occur on Native lands, it
must be done according to the UN Declaration on the
Rights of Indigenous Peoples, with full, free and prior
informed consent by all residents.236

There is a need for increased access to credit, financing
and insurance for Alaska Natives. Basic precursors to
business ownership are needed to ensure Indigenous
peoples are in fact the beneficiaries of an expanded
tourism business. One barrier: No access to credit to
start up a business.240 In a culture where fewer people
have a history of payments, a credit rating, and bank
accounts, especially in remote locations, how does
one begin to start up a business? Other obstacles
for Indigenous peoples interested in starting their
own businesses in the guide, expedition or tourism
business is the issue of how to most profitably gain
access to global markets.

Basic issues of development must be addressed.
In communities that want to pursue or expand
Indigenous tourism, basic infrastructure needs in
support of that tourism must first be met. Some of the
communities that could economically benefit from it
the most may at present be unable to host sizeable
groups of tourists due to local food insecurity, lack
of adequate lodging and transportation, and a gap
between the need for and availability of trained local
guides. Tourism training programs, local communities,
and the borough or state or federal land management
agencies may be able to identify creative solutions
to some of these challenges and test them as they
see fit. The remote locations, isolation, and small,
dispersed populations that comprise Alaska Native
villages make these areas difficult to develop for
tourists without up-front government support, which
is sorely needed.

Greater food security for Alaska Natives could mean
greater Indigenous tourism. A significant share of
tourism expenditures—a quarter of all travel expenses,
by some estimates—is spent on food, making food
service the highest category of travel spending.241
Most Alaska Natives consume a fairly narrow range
of foods, often hunting and gathering 80 percent of
their diet. Expanding the range of foods available for
tourists could be a win-win for Native communities:
It could enhance their own food security while
expanding access to a variety of foods for tourists.
Over one thousand years ago, European settlers in
Greenland were growing food.242 In Alaska, Russians,
missionaries and other settlers introduced gardening
and farming as early as the 1800s.243 With new
incentives and resources encouraging sustainable,
small-scale farming beginning to reach Alaska,

—CASE STUDY—
Oomingmak Musk Ox Producer’s Co-Operative
Around the world, artisan collectives create local
economies while celebrating local craftwork and
culture, often in rural and remote areas, and Alaska
is no different. One notable example is Oomingmak
Musk Ox Producer’s Co-Operative. Started in
1969, the co-operative is located in Anchorage but
represents artists from throughout Alaska, including
in many remote coastal villages. Qiviut, the underwool
of the musk ox, is collected each spring as it is shed
from animals at the Musk Ox Farm in Palmer and from
animals in other locations. It is then processed into
yarn, which is sent to knitters around the state who
are members and owners of the co-operative. The
The Oomingmak Musk Ox Producer’s Co-Operative brings
knitters make as many pieces as they like, featuring
original quiviut handknits from remote villages to visitors
and Alaska residents (U.S. National Park Service)
traditional designs from various regions of Alaska,
and send them in to the Anchorage shop, which sells
the pieces and gives the knitter a percentage of the sale. Revenue from the sales and an annual dividend help
to supplement the income for many knitters and their families, who contend with low employment and a high
cost of living in their remote villages.

58

SECTION V
“locavores” and food tourists, a growing segment of
the tourism sector, are also coming. Rural areas are
becoming increasingly popular destinations for travel
that allow a glimpse into how rural people live, work
and subsist. Cultural tourism and agritourism are both
feasible strategies for local economic development
and to promote traditional sustainable agriculture,
hunting, fishing, and gathering.

as a way to transform injustice in Native communities
and their lands. In his essay, an Environmental Justice
Framework For indigenous Tourism, in order to
achieve environmental justice, Whyte states:
“The tourism industry and communities [should]
develop practices that include forums of direct
participation. That means these practices are, in part,
initiated, designed, and shaped by the community
members, where the understanding and function
of environmental identities and heritages is coconstituted by all participants.”245

The development of agritourism tours and
demonstrations as attractions in rural areas provides
the potential for creating or expanding micro-, small-,
or medium-sized enterprise core and supply chain
businesses, including transport, food service and
products, and handicrafts. It can improve agriculture
value chain linkages, smallholder access to export
markets, product diversification, increased food
security, and promotion for agricultural products
within the tourism sector of a destination. In Homer, for
example, a local organic farmer enjoys free weeding
from young tourists who choose to work in his fields
as part of their cultural experience.244

With regard to advocacy and solidarity tours in
particular, Whyte states, “These practices do provide
a forum for direct participation, which in turn furnishes
the conditions for coalition building [among the
tourists, tourism operators, and community members]
… that do more than educate, reverse stereotypes, or
transfer knowledge.” Whyte continues: Such “coalition
development is a worthy ideal and one that should be
initially promoted before having to settle for mutually
advantageous exploitation.”
Dr. Freya Higgins-Desbiolles, a lecturer in tourism
with the School of Management of the University
of South Australa who focuses on human rights
and social justice issues in tourism, hospitality
and Indigenous tourism, warns that Indigenous
tourism risks “advancing Indigenous Peoples into
the neoliberal economy where there is little vision of
self-determination, acceptance of cultural diversity
and, sometimes, covert assimilation.” “However,”
she continues, “Indigenous rights have made great
progress through the United Nations and international
treaties and conventions and Indigenous Peoples
are leading their own way with initiatives that
advance community rights in tourism while fostering
understanding, best practices, and resistance to the
negative impacts of tourism.”246

Environmental justice
and advocacy
The transformative potential of Indigenous tourism
should not be ignored. Adding an environmental justice
and advocacy component to Indigenous tourism
could help create more equality and participation by
the community, with the tourism industry and with
tourists themselves. Kyle Powys Whyte, an enrolled
member of the Citizen Potawatomi Nation and
Associate Professor of Philosophy and Community
Sustainability at Michigan State University, addresses
moral and political issues concerning Indigenous
peoples. Whyte points to transformation as one of
the goals of the environmental justice movement that
could and should be applied to tourism - using tourism

Thematic area 7: sustainable fisheries
Alaska’s fisheries are considered some of the most
productive, sustainable, and healthy ones in the world.
This is no accident; Alaska is the only state in the US
with a mandate to sustainably manage fisheries built
into its constitution. Sixty-three thousand people
work in the seafood industry in the state, making it the
state’s largest private sector employer, and 56 percent
of the seafood harvested in the United States comes
from Alaska.248 Since 2010, the commercial fishing

industry has generated $121 million in revenues each
year, far surpassing annual operating and capital
expenditures by state and local governments ($96.8
million).249 Maintaining and expanding this industry
provides an important thematic area for sustainable
development policies.
Climate change will bring new opportunities for
sustainable fisheries, but also challenges. While yield,

59

SECTION V
harvests, and associated jobs and income may rise
for some species, changes in migration patterns,
ocean acidification, and invasive species are likely to
threaten the catch of others.250 Sifting through these
opposing effects and honing in on strategies to ensure
that local communities can adapt is a complex task
that must engage marine scientists, local fisher folk,
Alaska Natives, and fishery managers to succeed.
Initiatives with these goals in mind are proliferating,
not only for capture fisheries but for the emerging
aquaculture and mariculture industries as well.

industry and helping strengthen fishing communities
through access to opportunity and employment.
A third organization working on this front is the Alaska
Fisheries Development Foundation, a collaboration of
fishery harvesters, processors, and support sector
businesses founded in 1978 in Wrangell, Alaska. The
organization identifies problems related to the Alaska
seafood industry and collaborates with coastal
communities, research institutes, and government
agencies to develop effective, equitable solutions.253
This includes projects analyzing fishing vessel energy
efficiency, fish-product development competitions,
and aquaculture economic analyses for various
coastal Alaskan communities.

Capture fisheries

Indigenous-led organizations are active in promoting
sustainable fisheries and coastal communities as well.
For example, the indigenous-led Eyak Preservation
Council, based in Cordova, Alaska, was conceived by
commercial fisherman Dune Lankard and has the
stated goal of honoring Eyak tradition and
creating sustainable communities in
which the wild salmon way of life
is upheld and passed on from
generation to generation.254
In the past it has supported
the
preservation
of
over 700,000 acres of
ancestral
rainforest,
promoted
clean
renewable
energy
projects in the Eyak
community,
and
worked with indigenous
community members to
fight against destructive
development
practices
that threaten the Eyak
and salmon’s communal
ecosystem.

In response to these opportunities and challenges,
many independent nonprofits are working on
marine conservation and sustainable management
of fisheries, especially when it comes to supporting
coastal communities that rely on the industry.
For example, the Alaska Marine
Conservation Council has spent
the last 20 years protecting the
integrity of Alaska’s marine
ecosystems while at the
same time working to
improve the vitality of the
coastal
communities
that rely on the ocean
for their livelihoods.
On the one hand, the
organization is actively
working to reduce
bycatch, fight against
ocean acidification, and
influence federal and
state fisheries policy to
protect salmon and halibut.
On the other, it is working in
partnership with the University
of Alaska Fairbanks and Alaska
Sea Grant on a project called
“Graying of the Fleet,” which examines the
social, cultural, economic, and geographic factors
turning young people away from participating in the
local fishing industry.251

Sitka Salmon
Shares, a completely
integrated boat-todoorstep seafood company
founded in 2011 that operates a
“Community Supported Fishery,”
connects fishermen and
processers in Sitka, Alaska
with customers across the
Midwest.

Finally, innovative businesses are
being developed in Southeast Alaska
to revitalize the fishing industry and promote
sustainable, ethical seafood consumption. One of
the best examples of this is Sitka Salmon Shares,
a completely integrated boat-to-doorstep seafood
company founded in 2011 that operates a “Community
Supported Fishery,” which connects fishermen and
processers in Sitka, Alaska with customers across
the Midwest in Illinois, Iowa, Michigan, Wisconsin,
Indiana, and Minnesota.255

Another organization working in the same vein is the
Alaska Sustainable Fisheries Trust, which helps young
fishermen in Southeast Alaska overcome barriers to
entry in the local fishing industry by providing loans to
purchase initial fishing quotas, and then sharing the
annual value of the catch with fund investors.252 In this
way, the Trust is countering the graying of the fishing

SECTION V
independent, small-boat fishermen in Sitka, ranging
from “Regular” (5 lbs per month) to “Family” (10
lbs per month) and “Neighborhood” (15 lbs per
month), which are then hand delivered to customers’
doorsteps each month. Harvests include Halibut
in May, Black Bass in June, Lingcod in July, King
Salmon in August, Sockeye Salmon in September,
Coho Salmon in October, Spot Prawns in November,
and Dungeness crab in December. One percent of
revenues are returned to fishery conservation and
habitat protection efforts, and the company offsets its
carbon emissions related to transporting the catches
from Alaska to the Midwest.256

soon explode, however, if the efforts of the Alaska
Fisheries Development Foundation (AFDF) in the area
of mariculture prove successful.
Thanks to a grant of over $200,000 from the National
Oceanic and Atmospheric Administration, the
organization launched the Alaska Mariculture Initiative
(AMI) in the second half of 2014, and the organization
believes the shellfish mariculture industry in Alaska
could hit a billion dollars in revenue within 15 to 20
years.259 Oysters and geoducks are the two shellfish
currently being considered by the project. AFDF is
optimistic that the right stakeholders are aligned for
the industry to develop, and points to the fact that
shellfish and seaweed mariculture was one of the
top professed areas of interest for the North Pacific
Research Board in their 2016 Annual Request for
Proposals.260

Sustainable
aquaculture and
mariculture

In addition, AFDF has been working with Governor
Bill Walker’s Administration to create an Alaska
Mariculture Task Force to increase visibility and
resources attracted by this industry.261 Some of
the policy interventions being discussed include
mimicking the state’s successes around its salmon
enhancement program. In the context of that program,
the state of Alaska backed a $100 million revolving
loan fund so hatcheries could get built and operate
for several years. This bought enough time to develop
tax and cost recovery programs to help pay back the
long-term loans.262 ¢

Commercial finfish farming is banned in Alaska
(including salmon, halibut, and cod), but shellfish and
other marine invertebrates have been legal to grow
with the appropriate State permits since the passage
of the Aquatic Farm Act in 1988. 257Mariculture
(aquaculture in saltwater) in the state is still quite
small, however. In 2013, the 68 shellfish mariculture
farms in operation across Alaska sold less than
$800,000 worth of shellfish.258 That number may

61

Section VI
VI: Concluding thoughts – from crisis to opportunity.
In the 1990s, Oil, Chemical and Atomic Workers (OCAW—now merged with the
Steelworkers) Union Secretary-Treasurer Tony Mazzocchi coined the term “just
transition.” He recognized that OCAW members worked in some of the most dangerous
and toxic industries on the planet and, if they were to survive, both individually and
collectively, they needed to begin to plan a transition away from these hazardous
industries that was just. Tony used to say, “There’s a Superfund for dirt; there ought to
be a superfund for workers.”263 Despite Mazzocchi’s visionary call for a just transition,
it wasn’t until after his death in 2002 that his work was embraced more broadly by
elements of labor, environmentalist, and environmental justice communities who saw in
his call for a “just transition” for workers a similar need for a “just transition” for people in
so-called “fenceline” communities, close to toxic and extractive industries, and for their
environment. 264
Quinton Sankofa, a staff member of the nonprofit group
Movement Generation, was quoted by writer Naomi
Klein as saying: “Transition is inevitable. Justice is
not.” A great transition is underway in Alaska, but
justice is not yet part of that transition. Alaska’s shortsighted and near total dependence on oil and gas
revenues should be a cautionary tale for the rest of
the country, if not the world. With little to no planning,
the entire state of Alaska is now suffering through an
extraordinarily unjust transition. But nothing focuses
the mind like a crisis, and many people throughout
Alaska are beginning to explore the opportunities
of abundance and self-reliance that lie on the other
side of dependence on the fossil fuel industry. It is
that opportunity that remains to be fully embraced by
most elected officials in Alaska, who remain largely
beholden to their sponsors in the fossil fuel industry.

and resources are expensive to extract and need to
stay in the ground if the planet—much less, Alaska
– has any decent chance of avoiding the most dire
consequences of climate change.
The framework of sustainable development
embraced by the U.S. and 191 others in “The Future
We Want,” the outcome document from Rio+20, and
the new Sustainable Development Goals provides a
hopeful way forward. Both sets of agreements and
commitments are universal: they apply equally to both
developed and developing countries in recognition of
the fact that even in the richest nations there are regions
with high poverty, deteriorating social and economic
conditions, and environmental degradation. As such,
they provide an alternative blueprint for Alaska’s future
that focuses on meeting the social, environmental,
and economic needs of the population in more direct
ways than resource extraction has done in the past.

This report focuses on the sustainable development
opportunities this crisis creates – economic
opportunities that are designed to benefit those least
well off, protect Alaska Native rights and culture, and
maintain the productivity of aquatic and terrestrial
ecosystems even as the climate change signal
deepens. To ensure that the transition is as just and
seamless as possible, decision makers in Alaska
should begin to embrace these new opportunities
now. The era of high oil prices is probably over for
good, the state’s untapped oil, gas, and coal reserves

The UN’s sustainable development framework puts
a high priority on food security, quality education,
affordable energy, resilient infrastructure, sustainable
resource management, and eradication of poverty.
We believe that economic development options
in Alaska that advance one or more of these goals
simultaneously—with a particular focus on the needs
of Alaska Native communities – must be a high
priority. In this report, we suggest seven thematic

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SECTION VI
areas that could provide fertile ground for solutions
that can be scaled up, strengthened, and invested in.
These include human capital – the degree of knowhow, skills, and knowledge a population embodies.
Human capital requires investments in education
and connectivity in Alaska, yet this sector’s budget
is now on the chopping block. We also explore some
very promising developments in renewable energy
of all sorts around Alaska. Ironically, many of these
developments are in response to the high price of
diesel, not climate change, yet they hold promise for
building more self-reliant communities. Self-reliant
communities can also benefit from policies to bolster
local production of food and manufactured goods.

transition visioning and planning processes wherever it
makes sense to do so and use the resulting plans to
guide policies and investments to scale up sustainable
development solutions that emerge from the process.
Of course, a just transition will not be cheap. For
example, substantial investments need to be made to
ensure the relocation of communities now suffering
severe consequences from climate change, a task that
may cost in excess of $30 billion. But we believe there
are many financing options to consider:

Cut fossil fuel
subsidies

Knowledge Sharing
Networks

An immediate step that can be taken to ensure that the
fossil fuel industry pays its fair share of the just transition
is to end the enormous subsidies this industry receives
from both state and federal programs. Subsidies
distort oil and gas markets by financing production
that would not otherwise occur. Oil and gas operations
in Alaska are subsidized by the state through a variety
of tax credits. Some are refundable, meaning they
are essentially worth cash and others can be sold or
traded to other companies and used to erase the taxes
a company would otherwise pay to the state. These
subsidies are substantial, and terminating them will
free up state revenues for many other uses, including
planning for and investing in the just transition. The
state Department of Revenue has determined the value
of tax credits it will likely owe in the next fiscal year
to companies with no tax liability plus those carried
forward to top $1.4 billion.265 In recent years, the annual
state subsidy for oil and gas has been roughly $800
million.266

A recurring theme among the July 2016 workshop
discussions on these topics was the need for knowledge
sharing networks – that is, intentionally developed
resources and structures for communication so that
information can be shared among regions, especially
among rural communities and between urban and
rural communities. These networks would foster the
sharing of valuable information between communities
and individuals including: lessons learned from local
initiatives, skills development, proposals, resources,
opportunities for advocacy, and regional successes in
implementing just transition solutions.
We also discussed the many ways in which existing
fossil fuel infrastructure can and must be dismantled
– without the state picking up the tab – and the
economic importance of protecting and restoring the
state’s pristine marine and terrestrial ecosystems to
benefit subsistence uses, tourism, and Alaska Natives.
Indigenous tourism is another thematic area with great
potential for development, but only if it is guided by
safeguards to ensure that Alaska Natives are the primary
beneficiaries instead of tourism ventures owned by
distant corporations. And fisheries are without a doubt
a major resource for all of Alaska. The challenge now is
to ensure that the sector does a better job of meeting
Alaska’s food security challenges and that the wealth
from processing and exporting these fish stocks stays
within the state.

Federal subsidies for the fossil fuel industry are
equally generous, and have been rising in recent
years. According to Oil Change International, federal
production and exploration subsidies – “some of the
most inefficient and least defensible subsidies” –
increased from $12.5 billion in 2009 to $18.5 billion in
2013.267 These data are not broken out by state, but
Alaska producers receive a large share. Both federal
and state subsidies make a big difference to many
producers. For example, according to figures from the
Department of Revenue, oil and gas companies spent
$1.09 billion in Cook Inlet between fiscal year 2007
and fiscal year 2015. About $450 million of that was
provided by the state via tax credits.268 The Walker
Administration and the legislature have begun to scale
back these subsidies, but political opposition has
prevented major cuts.

Policy interventions are desperately needed in these
and other sectors to remove barriers and steer
investments and development in the right direction.
First, and most importantly, tribal, federal, state, and
local government agencies should engage in economic

fee on their energy consumption would achieve two
things: it would provide financial resources that would
revert to those communities and individuals that use
the least amount of fossil fuels, including Alaska
Native communities, and it could incentivize greater
efficiency of industrial operations in Alaska.

Increase federal
spending

Looming on the horizon is the
cost of dismantling, removing,
and restoring fossil fuel
infrastructure sites if policies
are
not
immediately
reformed to limit public
financial liabilities. It is
only fair to make sure
these costs are not
passed on to ordinary
citizens and already
stressed state and local
public agencies.

The first step to
The federal government
ensure that the fossil
should pay its fair share
as well. There are vast
fuel industry pays its fair
swaths of federal public
land and both military
share of the just transition
and non-military federal
facilities throughout the
is to end the subsidies
state. And the federal
government has been
this industry receives
instrumental in sustaining
Alaska’s
oil-based
from state and federal
economy for decades. The
federal government is already
programs.
investing a great deal in Alaska

Approaches to ensuring
that the fossil fuel industry
pays its fair share include
shoring up financial assurances
for DR&R activities, as discussed
in Section V. But that will still leave
climate adaptation expenses uncovered.
Fossil Fuel Risk Bond (FFRB) programs – a concept
developed by the Center for Sustainable Economy
– could help close this funding gap. FFRBs can be
put in place by both state and local governments
and would lock in adequate financial assurances for
all forms of fossil fuel infrastructure DR&R and other
risks to public finance. They would also establish
surcharge-based trust funds that can be used to
finance climate adaptation expenses – like the cost of
relocating villages and infrastructure – and response
and recovery costs associated with wildfires, floods
and other climate disasters. CSE estimates that a
$38/mt-CO2-e surcharge on the carbon content of
all fossil fuels traded in the state could generate over
$9 billion in revenues each year earmarked to cover
these public financial costs.269

– federal expenditures support
about a third of all jobs.270 But much
more needs to be done. Specific areas of
new federal spending could include: economic
transition and relocation planning, renewable energy,
climate change monitoring and science, and climate
change adaptation.

The military should be
a catalyst for scaling
up energy efficiency
and renewable energy
solutions
The U.S. Military is the largest single employer in
the state of Alaska, with 19,436 active military in the
state271 and an additional 5,157 civilian personnel.272
The Pentagon not only recognizes that climate
change is a grave threat to the planet,273 but is also
investing heavily in renewable energy.274 The Navy
alone is scheduled to provide over a gigawatt of
energy from renewable energy by 2020,275 enough to

Fee and dividend
Another option that could be explored in Alaska is
the imposition of a “fee and dividend.” Given that
industrial end users are both the least efficient energy
consumers and the largest in the state, a carbon

64

SECTION VI

International climate
adaptation and
mitigation funds for
tribes

provide half of the power for all of its military bases
nationwide. It thus makes sense for Alaska’s military
bases to be powered by renewable energy. While
the Air Force’s Tin City Long Range Radar Station
is developing a 250 kW wind turbine project to cut
diesel fuel use at the remote Alaska station by 30 to 35
percent,276 this is a small share of the military’s carbon
footprint in Alaska. At a minimum, the military should
begin to retrofit all of their bases in Alaska to run at
maximum efficiency and on renewable energy to the
greatest extent possible, in keeping with their shift
to greater renewable energy uptake in the Lower 48.
And, in order to enhance the local food security and
economy of the state, the U.S. military should commit
to buying Alaska-grown food and to procuring goods
and services in-state to the greatest extent possible.

Though it is distinct from a “just transition,” the UN
Climate Convention recognizes a similar equity issue
in calling for the compensation for climate change
adaptation and mitigation costs that developing
countries will incur. However, the UN does not now
recognize the rightful needs of Alaska’s Native nations
who are being harmed most dramatically, and most
immediately, from a crisis they played little to no part
in creating.

Allow Alaska Native
communities to be
eligible for federal
funding that excludes
them

Currently, the UN Framework Convention on Climate
Change does not view nations within nations—such
as the Inupiat or the Yupik—as distinct from the nation
that surrounds them, the United States. This oversight
means that tribal nations that might otherwise be
viewed under the UN as eligible for international
climate change adaptation and mitigation funding,
are ineligible. As one of the leading greenhouse gas
emitters in the world, the U.S. has a major role to play
in redressing this wrong at the international level. Until
the UN recognizes the national status of Indian tribes,
the U.S. government must begin by ensuring that
federal funds sufficient to meeting the sustainable
development goals as outlined by the UN are provided
to Alaska Natives and other tribes.

There is also the need for a significant scaling up and
redirection of federal expenditures targeting Alaska
Native communities. Currently, tribal governments,
including Alaska Native tribes, are ineligible for
many federal funds that other state and local
governments can receive for programs for relocation,
or to incentivize renewable energy, energy efficiency,
forest protection, sustainable fisheries management,
coastal zone management or estuarine research, and
education—all critical arenas in the climate change
challenge. Alaska Natives have a key role to play in
all of these arenas and should be eligible for federal
funds to engage more deeply in them.

Philanthropy
The philanthropic community has a critical role to
play in ensuring that Alaska’s transition away from
fossil fuels is just. The funding community could
engage in ensuring support and capacity-building
for organizations on a range of transition-related
services in the state, with a focus on attracting private
capital for economic opportunities for Alaska Natives
in sustainable enterprises, and ensuring non-profits
are capable of managing transition funds. One of
Alaska’s leading foundations, Rasmuson Foundation,
recognizes the urgency of acting now on the state’s
fiscal crisis, and is working to ensure it does not
worsen.

For example, according to a 2009 GAO report, “64
villages do not qualify for affordable housing and
relocation assistance from the Department of Housing
and Urban Development’s Community Development
Block Grant program because the federal law governing
the program does not recognize unincorporated
Alaska Native villages in Alaska’s unorganized borough
as eligible units of general local government.”277 The
National Congress of American Indians identified
several such programs in the natural resources arena,
particularly striking in light of the interrelationship
indigenous peoples recognize and have with the
ecosystems upon which they depend.278

65

SECTION VI

Public banks

an example of the former. The GPI is one of the few
“Beyond GDP” indicators that has been fully vetted
by economists and that takes income inequality,
environmental degradation, and social ills into account
when it measures economic wellbeing.280 Among the
states that have embraced the GPI as a measure
of economic well-being are Hawaii, Maryland,
Washington, and Utah.

The state of North Dakota is the only state to have
established its own publicly-owned bank. The
bank survived the financial recession of 2008 and
continues to thrive, despite the downturn in the oil
and gas industry. It provides low-interest student
loans, small business loans, agricultural loans,
and loans to community banks that provide home
mortgages. The Bank of North Dakota has helped
ensure that the benefits of economic growth in North
Dakota stay in North Dakota. A Bank of Alaska could
provide much-needed financial support to struggling
Alaskan business-owners, homeowners, students,
and farmers, while keeping Alaska’s economic growth
sustainable. An evaluation of credit union versus bank
economics with respect to helping Alaskan’s economy
may empower Alaskans to evaluate their choices.

An additional innovative solution for Alaskan business
owners is the Benefit Corporation, or “B Corp.”281
Two B Corps currently call Alaska home: Alaska
Glacial Mud and Arctic Solar Ventures Corporation.
B Corps allow socially responsible investors to find
and invest in corporations committed to enhancing
the “triple bottom line” of environment, economic
and social wellbeing. They are “for-profit companies
certified by the nonprofit B Lab to meet rigorous
standards of social and environmental performance,
accountability, and transparency.” As Alaska moves
to a more diverse, non-extractive economy, B Corps
could help lead the way while providing investors,
including local investors, an opportunity to ensure
their money is helping all of Alaska move forward
sustainably. Native Corporations may find a greater
pool of socially responsible investors if they were to
become B Corps.

Native banks
It is important to provide support for Alaska Natives
who choose to remain outside the formal economy
to the extent they wish to, while also providing for the
financial needs of Alaska Natives. There are a variety
of ways to achieve this goal, but one way is via microcredit lending. On a larger scale, tribes can choose to
own their own national banks. A move in this direction
by tribal leadership could ensure that the benefits of
economic growth remain within the tribe.279

These are all additional options to consider over and
above reforms already being implemented by the
Walker Administration. Taken together, the sustainable
development framework offered here and the various
funding options available hold great promise for a
smoother, more equitable, and more sustainable
transition to a prosperous future. But it will require
bold leadership from elected officials willing to risk
breaking their ties with their sponsors in the oil and
gas industry to ensure Alaska’s future is no longer
tethered to their fortunes, good and bad. ¢

The seven thematic areas we discussed are by no
means exhaustive. There are many other exciting
possibilities for sustainable development solutions
that are even more fundamental, such as new
metrics to guide economic policy and new kinds of
corporations that make sustainable development part
of their DNA. The Genuine Progress Indicator (GPI) is

ing back. The world has moved on.” Alaska Dispatch, June
1st, 2016. Available online at: http://www.adn.com/voices/
commentary/2016/06/01/alaskas-oil-glory-days-arentcoming-back-the-world-has-moved-on/.

Goldsmith, Scott and Pamela Cravez. 2016. Alaska’s Construction Spending Forecast 2016. Annual Report for the
Construction Industry Progress Fund and the Associated
General Contractors of Alaska. Anchorage, AK: Institute of
Social and Economic Research, University of Alaska.

21. Data obtained from US Census “Quick Facts” and Alaska
DLWD, Note 27.
22. Talk Poverty maintains year by year and state by state statistics on key dimensions of poverty at: https://talkpoverty.
org/state-year-report/alaska-2015-report/.

11. Oil price forecasts from both the World Bank and IMF
have been compiled and published by Knoema at: https://
knoema.com/yxptpab/crude-oil-price-forecast-long-term2016-to-2025-data-and-charts.

23. Talberth, John and Daphne Wysham. 2013. Closing the
Inequality Divide. A Strategy for Fostering Genuine Progress in Maryland. Washington, DC: Center for Sustainable
Economy and Institute for Policy Studies.

67. Alaska Forward calls for expansion of 11 industrial,
commercial, or governments clusters: Four of these would
involve resource-exploitation activities of the past: mining,
oil/gas, logging, and fishing. Others include travel/tourism,
federal spending, military activities, logistics and international trade, machinery fabrication, advanced business
services, and community and social services.

74. Unless otherwise indicated, the list of subsistence product
uses was taken from Bureau of Land Management, Alaska,
Subsistence, available online at: http://www.blm.gov/ak/
st/en/prog/subsistence.html.

93. Id.
94. Agreement between the Government of Canada and the
Government of the United States on the Conservation of
the Porcupine Caribou Herd. Published online at: http://
www.treaty-accord.gc.ca/text-texte.aspx?id=100687.

152. The Institute for Local Self Reliance maintains a fairly
comprehensive list of studies addressing these and other
social, economic, and environmental benefits. It is available under the heading “Key Studies: Why Local Matters”
at: https://ilsr.org/key-studies-why-local-matters/.

172. Center for Economic Development. 2014. Manufacturing
Extension Partnership Alaska Planning Study. An Analysis
Prepared for the State of Alaska with support from NIST
MEP. Anchorage, AK: University of Alaska Center for Economic Development.

184. Alaska Department of Natural Resources (ADNR). 2013.
Re: Notice of Public Workshop Regarding Offshore Platform Rehabilitation and the Purpose and Need for Potential
Changes to the Regulations of the Alaska Department of
Natural Resources. Anchorage, AK: Division of Oil and Gas,
ADNR.

225. Halpern, Benjamin. 2003. “The impact of marine reserves:
do reserves work and does reserve size matter?” Ecological Applications 13(1): Supplement, S117-S137.
226. “Fiscal Effects of Commercial Fishing, Mining and Tourism What does Alaska receive in revenue? What does it
spend?,” by Bob Loeffler and Steve Colt, Institute of Social
and Economic Research, University of Alaska Anchorage,
December 12, 2015. Available online: http://www.iser.uaa.
alaska.edu/Publications/2015_12-FiscalEffectsOfCommercialFishingMiningTourism.pdf

236. See March 2008 UN Declaration on the Rights of Indigenous Peoples (UNDRIP) online: http://www.un.org/esa/
socdev/unpfii/documents/DRIPS_en.pdf. U.S. President
Barack Obama endorsed the UNDRIP on December 16,
2010.

264. Movement Generation Justice and Ecology Project. 2017.
From Banks and Tanks To Cooperation and Caring: A Strategic Framework for a Just Transition.

278. National Congress of American Indians. 2012. FY’12 Indian
Country Budget Request. Available online at: http://www.
ncai.org/resources/ncai-publications/indian-country-budget-request/fy12-indian-country-budget-request.

279. See “A Guide to Tribal Ownership of A National Bank,”
The Office of the Comptroller of the Currency, September
2002. http://www.occ.treas.gov/topics/community-affairs/
resource-directories/native-american/tribalp.pdf.

266. Makhijani, Shakuntala. 2014. Cashing in on All of the
Above: U.S. Fossil Fuel Production Subsidies Under
Obama. Washington, DC: Oil Change International.